• Investing
  • Stock
Round Table Thoughts
  • Economy
  • Editor’s Pick
Home Editor's Pick Under Armour is laying off workers as retailer says North America sales will plunge this year
Editor's Pick

Under Armour is laying off workers as retailer says North America sales will plunge this year

by May 17, 2024
by May 17, 2024 0 comment
Share
0
FacebookTwitterPinterestWhatsapp

Under Armour announced a broad restructuring plan on Thursday as it said sales in its largest market, North America, plunged 10% and predicted the trend will get worse throughout its current fiscal year. 

The athletic apparel retailer also saw profits sink by more than 96% during its fiscal fourth quarter, compared with the year-ago period. 

It’s unclear how many employees Under Armour will lay off as part of the restructuring, but the plan is expected to cost between $70 million and $90 million, a portion of which will be used for employee severance and benefits costs. The company declined to share more information with CNBC about its restructuring.

The company’s shares were down more than 2% in morning trading. 

Here’s how the athletic apparel retailer did in its fiscal fourth quarter compared with what Wall Street was anticipating, based on a survey of analysts by LSEG:

The company’s reported net income for the three-month period that ended March 31 was $6.6 million, or 2 cents per share, compared with $170.6 million, or 38 cents per share, a year earlier. Excluding one-time items, the company reported earnings of 11 cents per share. 

Sales dropped to $1.33 billion, down about 5% from $1.4 billion a year earlier. 

During the quarter, sales in North America declined 10% to $772 million, worse than the $780 million that analysts had expected, according to StreetAccount. 

Under Armour said it expects sales to continue to worsen in North America. The company anticipates they will drop between 15% and 17% in its current fiscal year. 

“Due to a confluence of factors, including lower wholesale channel demand and inconsistent execution across our business, we are seizing this critical moment to make proactive decisions to build a premium positioning for our brand, which will pressure our top and bottom line in the near term,” founder and CEO Kevin Plank said in a statement. 

“Over the next 18 months, there is a significant opportunity to reconstitute Under Armour’s brand strength through achieving more, by doing less and focusing on our core fundamentals,” he added.

Across Under Armour’s business, the company is expecting revenue to be down “at a low-double-digit percentage rate” in its current fiscal year, while analysts had expected sales to grow by 2.1%, according to LSEG. 

The company is planning to cut down on promotions and discounting, which it expects will lead its gross margin to rise between 0.75 and 1 percentage point for the fiscal year. 

It’s expecting diluted earnings per share to be between 2 cents and 5 cents and adjusted diluted earnings per share to be between 18 cents and 21 cents for the year. Analysts had expected earnings per share of 52 cents, according to LSEG. 

Under Armour’s rough quarter comes about two months after the retailer announced former Marriott executive Stephanie Linnartz would be stepping down from her role as CEO after barely a year on the job and Plank would once again take the helm of the company he founded in 1996. 

Linnartz was the second CEO the company has cycled through in less than two years. 

She was hired on a bet that her experience building out Marriott’s renowned Bonvoy loyalty program and driving digital revenue for the hotel giant would offset her lack of experience in the retail industry. Before her departure, she managed to overhaul Under Armour’s C-suite and build out its loyalty program. She was attempting to pivot the brand’s assortment to a more athleisure-focused offering that had more stylish options for women. 

Ultimately, she was ousted before those plans could become a reality. Following the announcement of Linnartz’s departure, a number of analysts downgraded Under Armour and lowered their price targets. Shares of the company were down about 23% year to date, as of Wednesday’s close. 

Read the full earnings release here.

This post appeared first on NBC NEWS
You Might Also Like
  • More than $1 billion in federal tax refunds unclaimed as deadline to file approaches
  • If you faced a tax penalty during the pandemic, the IRS may have a new break for you
  • As Joann Fabrics and JCPenney announce store closings, here’s what’s driving the pattern
  • How crazy popcorn buckets became big business for movie theaters
Share
0
FacebookTwitterPinterestWhatsapp

previous post
McDonald’s $5 value meal is coming in June — and staying for just a month
next post
Gold and Silver Set to Smash Records: Could 2024 Be Their Biggest Year Yet?

You may also like

American Express to pay $230 million to settle DOJ fraud...

January 17, 2025

IRS has collected more than $520M in back taxes from...

January 13, 2024

China opens probe into Nvidia, accusing company of violating its...

December 10, 2024

NBA star Russell Westbrook launches AI-enabled funeral planning startup

May 7, 2025

AMD CEO calls China a ‘large opportunity’ and warns against...

May 7, 2025

‘Absurd’: NTSB chair blasts Boeing for failing to turn over...

March 8, 2024

UnitedHealthcare sued by shareholders over reaction to CEO’s killing

May 8, 2025

Several Buy Buy Baby and Harmon stores to reopen after...

August 19, 2023

GM to lay off 1,300 Michigan workers as vehicles end...

December 18, 2023

Summer Fridays are on the decline — companies may be...

June 17, 2024

    Stay updated with the latest news, exclusive offers, and special promotions. Sign up now and be the first to know! As a member, you'll receive curated content, insider tips, and invitations to exclusive events. Don't miss out on being part of something special.


    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Recent Posts

    • Breakouts, Momentum & Moving Averages: 10 Must-See Stock Charts Right Now

      May 31, 2025
    • Leadership Rotation Could Confirm Corrective Phase

      May 30, 2025
    • Run Your Stock Portfolio Like a Pro Sports Team

      May 30, 2025
    • U.S. foreign tax bill sends jitters across Wall Street

      May 30, 2025
    • Amazon taps Xbox co-founder to lead new team developing ‘breakthrough’ consumer products

      May 30, 2025

    Popular Posts

    • 1

      Trump-era China sanctions ended by Biden may be...

      June 27, 2024 2,765 views
    • 2

      Walz’s honeymoon with China gets fresh scrutiny as...

      August 9, 2024 2,472 views
    • 3

      Biden appointee played key role in recruiting Chinese...

      June 25, 2024 2,451 views
    • 4

      Shein’s global ambitions leaves some cybersecurity experts fearful...

      July 10, 2024 2,432 views
    • 5

      Harris VP pick spent years promoting research facility...

      August 29, 2024 2,308 views

    Categories

    • Economy (7,009)
    • Editor's Pick (2,106)
    • Investing (538)
    • Stock (2,581)

    Popular Posts

    • 1

      Trump-era China sanctions ended by Biden may be revived under new House GOP bill

      June 27, 2024
    • 2

      Walz’s honeymoon with China gets fresh scrutiny as Harris camp blasts ‘lying’ critics

      August 9, 2024
    • 3

      Biden appointee played key role in recruiting Chinese businesses to Delaware: ‘Longtime friends’

      June 25, 2024
    • 4

      Shein’s global ambitions leaves some cybersecurity experts fearful of Chinese spy threats

      July 10, 2024
    • 5

      Harris VP pick spent years promoting research facility that collaborated with ‘Chinese military company’

      August 29, 2024

    Latest News

    • Breakouts, Momentum & Moving Averages: 10 Must-See Stock Charts Right...

      May 31, 2025
    • Leadership Rotation Could Confirm Corrective Phase

      May 30, 2025
    • Run Your Stock Portfolio Like a Pro Sports Team

      May 30, 2025

    Categories

    • Economy (7,009)
    • Editor's Pick (2,106)
    • Investing (538)
    • Stock (2,581)

    Disclaimer: RoundTableThoughts.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2024 RoundTableThoughts.com. All Rights Reserved.

    Round Table Thoughts
    • Investing
    • Stock
    Round Table Thoughts
    • Economy
    • Editor’s Pick

    Read alsox

    Settlement reached in lawsuit between Ron...

    March 29, 2024

    Americans are flocking to Texas: 9...

    July 24, 2024

    How is the IoT being used...

    January 17, 2023
    Sign In

    Keep me signed in until I sign out

    Forgot your password?

    Password Recovery

    A new password will be emailed to you.

    Have received a new password? Login here