By Dhirendra Tripathi
Investing.com – Under Armour (NYSE:UA) stock (NYSE:UAA) plummeted 9% Friday after the company said it “expects material impacts for its spring-summer 2022 season” because of lingering supply chain challenges.
“There could be further material impacts on Under Armour's results in future periods,” it said while disclosing its fourth-quarter results.
The warning overshadowed the higher guidance that now pegs annual revenue gaining 25%, to $5.62 billion. Under Armour had earlier expected sales to grow in "low-20s."
The company brightened its outlook after revenue in the third quarter rose 8% to $1.5 billion and beat estimates. Consumer demand for the company's casual clothing stays sticky as people find them more comfortable while they carry out official and personal duties both. Its own and franchise stores did better as people returned to shop offline while the pandemic-fueled ecommerce sales declined.
Each of the categories -- apparel, footwear and accessories -- recorded double-digit growth. The biggest market, North America, grew the least, but still managed an 8% growth in quarterly revenue to $1 billion. All other geographies grew double digit.
Adjusted profit per share came in at 14 cents and beat estimates.
Under Armour said it will take a charge of $25 million to $75 million in the current quarter under its April 2020 restructuring plan. That exercise, aimed at improving the company’s profitability, has so far cost the company $500 million.