Under Armour Inc. continues to be unstoppable.
The Baltimore-based athletic footwear-and-apparel brand kicked off its 20th milestone year with a Q1 earnings and sales beat.
The firm said its net income, for the quarter ended March 31, increased 63 percent to $19 million, or 4 cents per diluted share, compared with $12 million, or 3 cents per diluted share, in the prior year’s period. Analysts had expected diluted earnings per share of 2 cents.
Under Armour’s net revenues advanced 30 percent in the quarter to $1.05 billion compared with net revenues of $805 million in the prior year’s period. On a currency neutral basis, net revenues increased 32 percent year-over-year. Market watchers were betting on revenues of $1.03 billion. International sales were also up 56 percent.
As has been the trend for some time, the biggest jolt to revenues came from footwear, gaining 64 percent to $264 million from $161 million in the prior year’s period.
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“For the past 24 consecutive quarters or six years, we have driven net revenue growth above 20 percent and we are incredibly proud of our start to 2016 with first quarter net revenue growth of 30 percent,” Under Armour chairman and CEO Kevin Plank said in a release issued today. “The strong results posted this quarter truly demonstrate the balanced growth of our brand across product categories, channels and geographies. It also showcases our heightened focus on providing better service across our distribution channels, ensuring that our consumer consistently finds the newest, most premium product from us wherever they shop.”
Q1 marks Under Armour’s third consecutive quarter of billion-dollar revenues, and Plank said during the firm’s conference call that he expects the brand to top the billion-dollar mark during every quarter this year based on the company’s newly upward adjusted guidance, which predicts revenues of $5 billion and operating income in the range of $503 million to $507 million.
“The footwear MVP for Under Armour, just like in the NBA, is Stephen Curry,” Plank said, referring to the Golden State Warriors star. “Our strong momentum in the fourth quarter 2015 carried through into the year with the Curry Two topping the signature shoe chart consistently week after week. Stephen’s phenomenal season has brought unprecedented attention to our overall footwear business and especially basketball footwear, driving both expansion with key mall partners and credibility with the hard-core basketball kid.”
Looking ahead, growth in China and expansion in e-commerce remain top priorities for the brand.
Analysts have been overwhelmingly upbeat on Under Armour’s Q1 beat.
“From our perspective, this was a solid quarter with no negative surprises,” Canaccord Genuity Inc. analyst Camilo Lyon wrote today. “More importantly, it is further evidence of the company’s ability to continue driving outsized, profitable growth. We view Under Armour as a once-in-a-generation company with vast growth opportunities ahead of it, and we thus reiterate our buy.”
As of 11:20 a.m. EDT, the brand’s stock had gained 7.4 percent to $47.17.
