Products are displayed in an Under Armour store in New York City, November 4, 2019.
Brendan McDermid | Reuters
Under Armour said Friday its revenue fell 41% during the latest quarter, but overall its results came in better than the retailer was expecting thanks to an e-commerce boost.
It was a strong online business that buoyed up the sneaker maker’s results, as Under Armour estimated roughly 80% of the bricks-and-mortar stores where its merchandise can be purchased, including its own shops, were closed due to the coronavirus pandemic through mid-May.
Its shares jumped more than 13% in premarket trading.
Here’s how the retailer did during its fiscal second quarter compared with what analysts were expecting, based on Refinitiv data:
- Loss per share: 31 cents, adjusted, versus a loss of 41 cents, expected
- Revenue: $707.6 million versus $543.8 million, expected
“Now, with most of these doors reopened, we are encouraged by some of the momentum we’ve experienced in June and July,” Chief Executive Patrik Frisk said in a statement.
“However, we remain appropriately cautious with respect to the balance of 2020 due to continued uncertainty related to consumer shopping dynamics, the potential for a highly promotional environment and proactive decisions to reduce inventory purchases to be more aligned with anticipated demand related to ongoing COVID-19 impacts.”
Under Armour reported a net loss for the period ended June 30 of $182.9 million, or 40 cents per share, compared with a loss of $17.3 million, or 4 cents a share, a year earlier.
Excluding one-time charges, the retailer lost 31 cents a share. That was less than the 41-cent loss analysts were predicting, according to Refinitiv.
Revenue fell to $707.6 million from $1.19 billion a year ago. Analysts expected revenue of $543.8 million.
Earlier this week, the Baltimore, Maryland-headquartered company disclosed it received notice of a possible enforcement action from the Securities and Exchange Commission related to the accounting treatment of sales it booked between the third quarter of 2015 and the fourth quarter of 2016.
On July 22, Under Armour in addition to two executives — Kevin Plank, its former CEO and current executive chairman, and David Bergman, its current CFO — received Wells notices from the SEC related to a previously disclosed probe by the agency, the company said in an 8-K filing.
A Wells notice doesn’t necessarily mean the company or the executives violated the law. However, it does indicate the agency is considering an enforcement action. Under Armour said Monday that it maintains its actions were “appropriate,” and it intends “to work toward a resolution of this matter” with the SEC.
As of Thursday’s market close, Under Armour shares are down about 47% this year. The company has a market cap of about $5.2 billion.
This story is developing. Please check back for updates.