2023-05-09 07:34:02 ET
Under Armour ( NYSE: UAA ) shares slipped in premarket action as persistent inventory issues overshadowed a beat on top and bottom lines for the fiscal fourth quarter.
For the quarter reported, the Maryland-based footwear and apparel manufacturer reported $0.18 in earnings per share, $0.03 above the consensus expectation. Meanwhile, a 7.7% jump in revenue to $1.4B was $40M above analyst estimates. Inventory closed the quarter up 44% as compared to Q4 2022 to $1.2B, above the $1.18B consensus expectation.
Due to the elevated inventory levels, management expects promotions to continue. As such, gross margin is expected to be up 25 to 75 basis points compared to the prior year's rate of 44.9% as supply chain improvements are offset by the inventory clearing actions.
“Fiscal 2024 will be a year of building for the brand. I am prioritizing significantly amplifying global brand heat; delivering elevated design and products, with a focus on Sportstyle, footwear, and women; and positioning us to drive better sales growth in the United States,” CEO Stephanie Linnartz commented. “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.”
Diluted earnings per share are expected to be between $0.47 and $0.51. Analysts had anticipated a report of $0.61 for fiscal 2024. Capital expenditures are expected to be between $250 and $270M.
Shares of Under Armour ( UAA ) edged 4.97% lower shortly after the earnings announcement .
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Under Armour stock slides on soft profit guidance