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Under Armour stock falls on sales miss

By Lorraine Mirabella, The Baltimore Sun
Published: January 31, 2017, 5:05pm

BALTIMORE — Under Armour shares plunged 23.4 percent after the Baltimore-based sports apparel maker reported fourth-quarter results Tuesday that missed Wall Street expectations.

The company blamed a challenging retail environment in the crucial end-of-year selling period for the weaker-than-expected sales and earnings. The company does, however, continue to grow, reaching a record $4.8 billion in sales for 2016, up 22 percent from the prior year.

Under Armour is currently renovating a former YMCA south of downtown Portland; the company is expected to open the new office complex in spring, according to the Portland Business Journal.

In the crucial October-to-December holiday quarter, though, sales only rose 12 percent to $1.3 billion and its profit slipped to $104.9 million from $105.6 million in the same period last year. Per share earnings dipped a penny to 23 cents each.

Analysts had expected Under Armour to earn 25 cents per share and post sales of $1.4 billion.

Under Armour shares fell $5.87 to a close of $19.22 in trading Tuesday.

Analysts had expected Under Armour profit margins to be weaker because of deep promotions introduced in the October-through-December period that have continued into January.

“We are incredibly proud that in 2016, we once again posted record revenue and earnings, however, numerous challenges and disruptions in North American retail tempered our fourth quarter results,” said Kevin Plank, Under Armour’s chairman and CEO.

Plank said he felt confident “in our ability to navigate the current retail environment,” because of the strength of the brand and investments in the fastest growing parts of the business, footwear, international sales and sales through the brand’s own stores and websites.

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