The company’s shares, down about 29% so far this year, were last up 2% in choppy premarket trading as second-quarter profit topped analysts’ estimates.
Freight and raw material costs are moderating for many global companies from the spikes caused by disruptions to the supply chain during the pandemic and compounded by the Russia-Ukraine war.
The athletic wear brand now expects annual gross margin to be up 100-125 basis points, compared with its previous expectation of up 25-75 basis points.
The company also expects its selling, general & administrative expenses to be flat to down slightly versus the previous forecast of flat to up slightly.
This has helped the retailer offset the hit from deep discounts rolled out to entice customers, mainly in the U.S., as many faced with higher interest rates and sticky inflation cut back spending on pricier apparel and footwear.
Under Armour (NYSE:UA) reported a 2% fall in its North America sales, while wholesale revenues declined 1% in the reported quarter.
Earlier in the day, European rival Adidas (OTC:ADDYY) said currency-adjusted sales in North America fell 8.8% due to reduced product orders from wholesalers there.
Under Armour now expects fiscal 2024 net revenue to fall between 2% and 4%, compared with its earlier outlook of flat to up slightly.
The company’s second-quarter profit of 24 cents per share topped analysts’ estimates of 21 cents, according to LSEG data, while net revenue of $1.57 billion was in line with expectations.
Source: Economy - investing.com
