Remember when Under Armour was making waves in the sneaker world? It feels like it was just yesterday that Under Armour was establishing themselves as heavy-hitters. The Stephen Curry signature line was at its peak and everything was looking up. Well, not anymore.
As most of you know, Stephen Curry had a huge helping hand in putting Under Armour in the spotlight. His latest signature sneaker, the Under Armour Curry 3 is not doing as good as it predecessor or as Under Armour would have hoped for. This has resulted in Under Armour slowing down quite a bit as shares for the company have gone down 25% to $18.80 USD this morning following a report of a weak first quarter sales gain.
Sales for the three months ending December 31 only went up 11.7% to $1.31 billion USD while net income fell 0.7% to $104.9 million USD. Both of those numbers did not reach the company’s expectations and has resulted in CFO Chip Malloy turning in his resignation papers.
Things may not be all that bad though. CEO Kevin Plank, had this to say on the matter at hand:
“We are incredibly proud that in 2016, we once again posted record revenue and earnings, however, numerous challenges and disruptions in North American retail tempered our fourth-quarter results. The strength of our brand, an unparalleled connection with our consumers and the continuation of investments in our fastest growing businesses — footwear, international and direct-to-consumer — give us great confidence in our ability to navigate the current retail environment, execute against our long-term growth strategy and create value to our shareholders.”
Under Armour does not expect things to change much this year as gross margins are expected to be “slightly down” as “benefits in product costs being offset by continued pressure from changes in foreign currency and sales mix, as the footwear and international businesses continue to outpace the growth of the higher margin apparel and North American businesses.”