Under Armour on Tuesday reported another sales decline in its key North America market but overall revenue beat analysts’ estimates on strong international demand, sending the sneaker company’s shares up more than 15%.
Under Armour’s fourth-quarter results appeared to cheer investors after a third quarter that saw its sales fall for the first time since it went public — dropping 12% — and a sharp decline in profit.
In the previous quarter, North America sales fell 12% and the downward trend continued in the quarter ended Dec. 31 with a 4% drop. But total revenue in the fourth quarter climbed 5% to $1.37 billion as sales in international markets jumped 47%, representing 23% of total sales.
Analysts had expected revenue of $1.31 billion, according to a Thomson Reuters survey.
Under Armour reported a net loss of $88 million, or 20 cents a share, compared with net income of $103 million, or 23 cents per share, a year ago. Excluding one-time items, Under Armour broke even on a per-share basis, matching analysts’ estimates.
In trading Tuesday, the company’s shares rose 15.5% to $16.43, the highest level since the stock caved after the third-quarter earnings report.
“After years of rapid growth and building a globally recognized brand, the dynamic landscape of 2017 was a catalyst for us to begin strategically transforming Under Armour into an operationally excellent company,” CEO Kevin Plank said in a news release.
“A year into this journey, our fourth-quarter and full-year results demonstrate that the tough decisions we’re making are generating the stability necessary to create a more consistent and predictable path to deliver long-term value to our shareholders,” he added.
As the Baltimore Sun reports, the once high-flying brand “has struggled with intense competition, shifting fashion preferences and growing pains as the retail sector in the core U.S. market has weathered bankruptcies and thousands of store closures.”
Investors had braced for weak sales over the holiday season but apparel sales increased 2.5% in the fourth quarter to $951.6 million, while footwear sales rose 9.5% to $246.2 million.