Under Armour stock is surging after earnings.
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Under Armour posted strong third-quarter sales and earnings Tuesday that firmly beat Wall Street’s expectations.
Even better: The sports-equipment company said the outlook was very bright for full-year earnings.
That sent shares in Under Armour soaring. The company’s Class A shares (ticker: UAA) jumped nearly 11% in premarket trading Tuesday, and the Class C shares (UAA)—which don’t carry voting rights—surged about as much too.
Under Armour reported revenue of $1.5 billion in the third quarter, up 8% from the same period a year ago and slightly ahead of analysts’ consensus estimates, according to FactSet. Revenue growth was strongest in the Asia-Pacific region, where sales surged 19%, and Latin America, where growth was 27%.
Under Armour’s adjusted earnings in the third quarter were 31 cents a share, firmly outpacing expectations of 15 cents. Operating income for the quarter was $172 million, with the company’s gross margin increasing 3.1 percentage points to 51%.
The outlook is where it really gets good.
Revenue growth, the company said, is expected to be 25% for the full year, up from previous guidance of a low-20s percentage increase. Margins are expected to expand 1.3 percentage points, up from previous guidance of a 50- to 70-basis-point improvement on last year’s adjusted gross margin of 48.6%.
Operating income is expected to hit $425 million, compared with previous guidance of a range of $215 million to $225 million, with adjusted earnings of 74 cents a share coming in above a previously guided range of 50 cents to 52 cents.
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