Under Armour Stock Drops as Guidance Disappoints Wall Street
Under Armour reported fourth-quarter earnings and revenue that beat analyst expectations, but its guidance for the next fiscal year fell short of Wall Street’s consensus, sending the stock down 4% in pre-market trading.
The market cap of Under Armour’s once high-flying stock, which peaked at $22 billion in 2015, is now $3.6 billion. The company previously said it wanted to challenge Nike, which is currently worth $195 billion.
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“Fiscal 2024 will be a year of building for the brand,” Stephanie Linnartz, Under Armour CEO, said in announcing the results. “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.”
Revenue for the quarter was $1.4 billion, up 7.5% from the prior year. Full-year sales reached $5.9 billion, or an increase of 3.1%. Revenue is expected to be “flat to up lightly” in fiscal 2024. Earnings are forecasted to range from 47 cents to 51 cents, well below analyst expectations of 61 cents.
This was the first earnings release as CEO for Linnartz, who was the president of Marriott International before she took over in late February. She is only the third permanent CEO in company history after founder Kevin Plank and Patrik Frisk.
Under Armour recently signed two-time NBA MVP Stephen Curry to a long-term extension that will carry over into his retirement. Curry was also named president of the Curry Brand, which launched in 2020.
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