Under Armour (NYSE:UAA) said Friday it sees a tough year ahead, roiled by global supply chain challenges and another round of COVID lockdowns in China that are putting a dent in demand.
The sneaker and apparel maker on Friday issued a disappointing outlook for its fiscal year 2023, after reporting an unexpected loss for the three months ended March 31 and sales that came in below Wall Street estimates.
In the first quarter. Under Armour lost one cent per share, compared to earnings of six cents a share expected. Revenue also fell short of expectations, chiming in at $1.3 billion, compared to the projected $1.32 billion.
Under Armour reported a net loss for the quarter of $59.6 million, or 13 cents per share, compared with net income of $77.8 million, or 17 cents a share, a year earlier.
Excluding one-time items, it lost a penny per share. Analysts had been looking for adjusted earnings per share of 6 cents.
Sales grew to $1.3 billion from $1.26 billion a year earlier. That missed estimates for $1.32 billion.
In North America, sales grew 4%, to $841 million. Its international business, however, grew just 1%, to $456 million, dragged down by a 14% drop in the Asia-Pacific region, which includes China.
Not only is China a growing market for Under Armour to try to win new customers, it’s also a major manufacturing hub for much of the athletic apparel industry. A number of international corporations have warned in recent days that a drag from China’s COVID controls will hit their businesses.
UAA shares dwindled $3.64, or 25.5%, to $10.65.
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