Working out from home: coronavirus pandemic powers Under Armour online sales, surprise profit
The health crisis led to a rise in demand for training shoes, running shorts and t-shirts
Richard Bernstein Advisors Deputy CIO Dan Suzuki weighs in on today’s markets and what to expect in the coming year.
Online demand for Under Armour’s apparel and accessories, and stronger Asia-Pacific sales helped it post a surprise holiday-quarter profit and top revenue estimates on Wednesday, sending its shares up 5% in premarket trade.
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The company said revenue in its Asia-Pacific market jumped 26%, cushioning a sharp decline in its Europe, Middle East, and Africa (EMEA) market, where several stores have been closed due to a resurgence in COVID-19 cases.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| UAA | UNDER ARMOUR INC. | 4.38 | +0.07 | +1.62% |
While the health crisis has led to a fall in attendance at gyms, it has given people more time to workout at home or opt for outdoor exercises including running and biking, leading to a rise in demand for training shoes, running shorts and t-shirts.
An Under Armour sign is seen outside a store in Chicago on Oct. 25, 2016. (Reuters/Jim Young)
With shoppers still limiting trips outside their homes, a large chunk of that demand has come from people shopping online. Under Armour said its e-commerce sales rose 25%, helping its high-margin direct-to-consumer segment jump 11%
Overall revenue fell about 3% to $1.40 billion in the three months ended Dec. 31, but topped a Refinitiv IBES estimate of $1.27 billion.
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Excluding items, Under Armour posted a surprise profit of 12 cents per share, while analysts were expecting a loss of 7 cents.