Source: Company reports

2Q16 RESULTS

Under Armour reported 2Q16 revenues of $1 billion, up from $783 million in 2Q15, a 28.2% year-over-year increase. During the quarter, wholesale revenues grew by 27% year over year, while direct-to-consumer revenues grew by 28%. Under Armour’s international business grew to represent 15% of the company’s total net revenues, increasing by 68% year over year. The company attributed increased operating costs to a onetime impairment related to the liquidation of Sports Authority and to continued investments in the direct-to-consumer business, including in the overall headcount needed to support the company’s strategic initiatives. Within product categories, apparel revenues increased by 19% year over year, and footwear revenues increased by 58%, reflecting the continued success of the Steph Curry signature basketball line. Accessories revenues increased by 21% from 2Q15, driven by growth in bags and head wear. Reported adjusted EPS was $0.01, representing an 83.3% decrease from EPS of $0.06 in the year-ago quarter and reflecting a $0.03 impact from the Sports Authority liquidation. The company paid a $59 million stock dividend to Class C shareholders in June 2016.

2016 OUTLOOK

Under Armour forecasted full-year revenues of approximately $4.9 billion, representing growth of 24% over 2015. The company expects year-over-year operating income to grow by 8%–9%. The company is planning to launch a new sportswear line in the fall of 2016 and to bring new customers to the brand through its digital platform and by expanding its flagship retail presence and creating new partnerships in wholesale. The company also plans to expand distribution in 2017 into Kohl’s.

NEW FLAGSHIP IN FORMER FAO SCHWARTZ SPACE IN NYC

Under Armour announced it will be opening a flagship store in the former FAO Schwartz location in New York City, which FAO Schwartz exited last year having cited rising rent costs. The space is 53,000 square feet and will serve as a “landmark retail space” as the company continues to build its brand and tell its story. Under Armour will use the space to build a unique, exciting experience for its customers and plans to open the store at the end of 2018 or in the first half of 2019.