Under Armour Inc has raised its profit and sales forecasts for the year after experiencing a significant increase in revenue. The reopening of economies in the United States and Asia has led to a surge in demand for Under Armour’s sports shoes and apparel. Consumer confidence has also improved thanks to the rollout of COVID-19 vaccines and government stimulus, resulting in increased discretionary spending on products like Under Armour’s.

The company witnessed an impressive 32% increase in quarterly revenue from North America and an astonishing 58% surge in revenue from its international segment. To make the most of this opportunity presented by recovering markets, Under Armour plans to ramp up its marketing efforts for its brand, stores, and website. The company aims to focus on North America, China, and Germany, and expects marketing and incentive compensations to constitute a significant portion of its increased costs this year.

Due to its strong performance, Under Armour has adjusted its full-year earnings per share forecast from 12 cents to 14 cents to between 28 cents and 30 cents. Additionally, it anticipates a high-teens percentage increase in full-year revenue, up from a previous projection of a high single-digit percentage rise. Looking ahead to the second quarter, Under Armour predicts a 70% increase in revenue, rebounding from last year’s decline caused by store closures during the pandemic.

However, Under Armour, like its competitor Nike Inc, faces challenges in transportation and logistics as a result of the pandemic. Delays at ports and difficulties in product distribution to retail stores have been major obstacles. Despite these challenges, Under Armour’s stock has performed well this year, climbing approximately 40%. Nevertheless, the company’s shares experienced a 2.3% decline to $23.60 amidst volatile trading.

Analysts also highlight the industry-wide challenges, expressing concerns regarding issues with ports and disruptions in the supply chain. Jessica Ramirez, a retail analyst at Jane Hali & Associates, acknowledges that, while consumer demand remains strong, the process of getting products into stores has proven to be a struggle.

In the first quarter, Under Armour’s net revenue surpassed expectations, reaching $1.26 billion compared to the estimated $1.13 billion. The company’s adjusted earnings per share were at 16 cents, surpassing the estimated 3 cents per share.

Overall, Under Armour’s strong performance in the first quarter and optimistic outlook for the year indicate that the sports apparel company is recovering well from the challenges posed by the COVID-19 pandemic. With increasing demand and improved consumer confidence, Under Armour is well-positioned to capitalize on growth opportunities in its key markets.

Useful Links:
1. Under Armour Official Website
2. Nike Official Website