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Under Armour swings to Q4 profit, but stock drops on FY24 outlook

By Huw Hughes

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Management

Image: Under Armour store | Credit: Liverpool One

Under Armour swung to a profit in its unaudited fourth-quarter results, but its stock fell due to a weaker FY24 outlook than analysts had expected.

The US sportswear giant posted a net income of 170.5 million dollars in the quarter ended March 31, compared to a loss of 59.6 million dollars a year earlier.

That came as revenue rose 8 percent to 1.4 billion dollars, with North America revenue increasing 3 percent to 862.2 million dollars and international revenue up 16 percent to 526 million dollars.

For the full-year, the company’s net profit widened to 386.8 million dollars from 222.7 million dollars as revenue grew 3 percent to 5.9 billion dollars.

Under Armour president and CEO Stephanie Linnartz told investors: “I'm honored to lead this iconic brand, and I'm pleased that Under Armour delivered fiscal 2023 revenue and earnings results that were in line with our previous outlook.”

FY24 outlook

Despite hitting targets, however, Under Armour’s stock fell 5 percent in premarket trading Tuesday as the company’s FY24 outlook fell short of analysts' estimates amid high inflation and falling consumer demand.

The company said it expects FY24 revenue to be flat or up slightly on the prior year, and for diluted earnings per share to be between 47 cents and 51 cents. Analysts had expected diluted EPS of around 61 cents, according to data from Refinitiv.

Linnartz said fiscal 2024 “will be a year of building for the brand”.

She continued: “I am prioritizing significantly amplifying global brand heat; delivering elevated design and products, with a focus on Sportstyle, footwear, and women; and positioning us to drive better sales growth in the US.

“We will leverage our strong portfolio of franchises, including Heat Gear, Cold Gear, and compression apparel, to drive innovation across new products and markets. We must deliver better for athletes and our customers and meaningfully increase returns for shareholders in the years ahead. My job is to make that vision a reality.”

Under Armour