Under Armor (UAA) Q3 revenue 2023

under armor informed holiday quarter earnings This beat Wall Street’s expectations on Wednesday, but the retailer is grappling with a growing inventory glut that active promotions and discounts have failed to alleviate.

The company’s shares rose on light pre-market trading.

Despite inventory problems, the sportswear company raised its profit forecast for the fiscal year. Earnings per share are now expected to be between 52 cents and 56 cents, compared to the previously expected range of 44 cents to 48 cents.

Here are Under Armor’s fiscal third quarter results compared to what Wall Street expected, according to an analyst poll conducted by Refinitiv:

• Earnings per share: 16 cents adjusted against expected 9 cents
• Income: $1.58 billion against the expected $1.55 billion.

The company’s net income for the three-month period ending Dec. 31 was $121.62 million compared to $109.66 million a year earlier. Sales rose to $1.58 billion from $1.53 billion a year earlier.

Like other retailers, the sportswear company is battling stock glut caused by supply chain issues and changing consumer demand trends. During the third fiscal quarter, Under Armor’s inventory rose 50% year-over-year. Despite strong promotions and discounts during the critical holiday quarter, inventory was up slightly from the previous quarter.

Promotions and discounts continued to cut Under Armor’s profits, which were down 6.5% year-over-year.

The company recorded a 7% jump in wholesale revenue and a decline in direct-to-consumer sales.

While sales in Asia fell by 9%, Under Armor has made great strides internationally. Revenue increased 45% in Latin America and 32% in Europe, the Middle East and Africa.

A 2% drop in apparel, which accounts for the bulk of Under Armor’s sales, was offset by a 25% jump in footwear revenue.

In December, the company announced that former Marriott chief executive Stephanie Linnarz would take over as CEO and begin work on February 27. Colin Brown has been acting CEO since June after the retailer’s previous top executive, Patrick Frisk, unexpectedly resigned. Maybe.

Under Armor is working to expand its e-commerce operations and is building on the expertise of Linnartz, who led Marriott’s multi-billion dollar digital transformation to accelerate the company’s digital initiatives.

E-commerce sales grew 4% QoQ and accounted for 36% of Under Armor’s total DTC revenue.

Read full income statement here.