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Under Armour's Q2 revenue jumps 91 percent, updates forecast

By Prachi Singh

Aug 3, 2021

Management

Image: Under Armour newsroom

Second quarter revenue at Under Armour was up 91 percent or 85 percent to 1.4 billion dollars compared to the prior year.

The company’s wholesale revenue increased 157 percent to 768 million dollars and direct-to-consumer revenue increased 52 percent to 561 million dollars, driven by strong growth in owned and operated stores offset by an 18 percent decline in ecommerce which represented 39 percent of the total direct-to-consumer business.

“We are very pleased with Under Armour’s better than expected second-quarter results, which reflect solid progress compared to both 2020 and 2019. Given the continued momentum, we’re raising our full-year outlook, which puts us on track to achieving a solid performance in 2021,” said Under Armour president and CEO Patrik Frisk.

Highlights of Under Armour’s Q2 results

The company said, North America revenue increased 101 percent to 905 million dollars and international revenue increased 100 percent or 84 percent to 446 million dollars. Within the international business, revenue increased 133 percent or 116 percent currency neutral in EMEA, increased 56 percent or 43 percent currency and increased 317 percent or 284 percent currency neutral in Latin America.

The company’s apparel revenue increased 105 percent to 874 million dollars, footwear revenue increased 85 percent to 343 million dollars and accessories revenue increased 99 percent to 112 million dollars.

Gross margin increased 20 basis points to 49.5 percent compared to the prior year, operating income was 121 million dollars, adjusted operating income was 124 million dollars, net income was 59 million dollars, while adjusted net income was 110 million dollars. The company added that diluted earnings per share was 13 cents and adjusted diluted earnings per share was 24 cents.

Under Armour updates 2021 outlook

Under Armour said full-year 2021 revenue is expected to be up at a low twenties percentage rate compared to the previous expectation of a high-teens percentage rate increase, reflecting a low twenties percentage growth rate in North America and a mid-thirties percentage growth rate in the international business.

Gross margin is expected to increase 50 to 70 basis points compared to the previous expectation of an approximate 50 basis point improvement versus the prior year adjusted gross margin of 48.6 percent with expected benefits from pricing and changes in foreign currency offset by the sale of the MyFitnessPal platform and expected higher freight expenses. Operating income is expected to reach 215 million dollars to 225 million dollars compared to the previous range of 105 million dollars to 115 million dollars. Excluding the impact of restructuring efforts, adjusted operating income is expected to reach 340 million dollars to 350 million dollars compared to the previous expectation of 230 million dollars to 240 million dollars.

Diluted earnings per share are expected to be 14 cents to 16 cents compared to the previous expectation of a diluted loss per share of 2 cents to 4 cents. The company added that adjusted diluted earnings per share are expected to reach 50 cents to 52 cents compared to the previously expected range of 28 cents to 30 cents per share.