Under Armour (UA) - Get Report posted better-than-expected second-quarter earnings Tuesday but issued softer 2019 earnings guidance and North American sales for the sportswear group continue to decline.
Under Armour's loss for the three months ended in June was 4 cents per share, narrowing from the 8 cents per share loss recorded over the same period last year and just ahead of the Wall Street consensus forecast of a 5-cent loss. Group revenue, Under Armour said, matched expectations at $1.2 billion. North American sales, however, fell 3% to $816 million and failed to offset a 17% gain in international revenue, which was $339 million.
Looking into 2019, the sportswear group said its sees revenue rising between 3% and 4%, with gross margins improving to between 110 and 130 basis points. Earnings were forecast in the region of 33 to 34 cents per share, however, around 2 cents shy of the Wall Street estimate.
"Our second quarter results give us increasing conviction that our transformation continues to make solid progress across our business, unlocking efficiencies that are driving greater precision, consistency and repeatability," said CEO Kevin Plank. "By staying sharply focused on our long-term strategies - driving our premium athletic brand positioning through industry leading innovation, geographic expansion and creating deep connections with our consumers - we are on track to deliver against our expectations in 2019."
Under Armour shares were down 14% to $20.97, a move that would trim the stock's year-to-date advance to 29.7%.