Sports apparel company Under Armour (NYSE:$UAA) is getting squashed.
On Tuesday, the Baltimore-based company saw their shares drop 15% in early trading after they posted a disappointing third-quarter earnings report.
Here’s what we know:
Under Armour posted revenue of $1.41 billion, which is a decline of 5% versus the same quarter in 2016. This is significant as it is the company’s first year-over-year revenue decline as a public company. As a point of reference, analysts had forecasted revenue of $1.48 billion. However, EPS came in at 22 cents, which is above analysts’ forecasts of 19 cents.
Perhaps the most important aspect of the Q3 report was that Under Armour cut its full-year outlook for 2017. Now, management forecasts 2017 full-year revenue to be up in the low single digits, whereas the company predicted gains as high as 11% earlier this year.
In Tuesday’s press release, Under Armour forecasts full-year operating income to come in at “0 to $10 million.” What does this mean? Well, it means the company might not even cut a profit this year.
“Clearly this is a much different profile for the year than we discussed 90 days ago,” acting CFO Dave Bergman said on Tuesday’s earnings call. “On that call, we outlined several key factors we thought would come to fruition… demand and challenges in North America significantly altered the terrain.”
Even though the report consisted of mostly bad news, there were some bright spots. Under Armour might be struggling in North America – which is its most important region – but the brand is growing steadily outside of America. In fact, international revenue was up 35%.
Featured Image: depositphotos/jetcityimage2
