Shares of Under Armour were deep in the red in Tuesday trading after a dismal third quarter financial report and a slashed outlook looking ahead.
The sports apparel company reported revenue of $1.41 billion for the third quarter, dragging behind the $1.48 billion that analysts wanted. It was also a 5% drop compared to the same quarter a year ago. EPS at 22 cents was a beat, as analysts had waited for 19 cents.
Traders were mostly concerned with the fact that the Baltimore-based company has slashed its full-year outlook for 2017. The company now forecast low single digits when before it had predicted as much as 11% in gains.
The company may not even make a profit at all for the year as management has now forecast operating income for the full year to be $0 to $10 million.
“Clearly this is a much different profile for the year than we discussed 90 days ago,” said acting CFO Dave Bergman.
“On that call, we outlined several key factors we thought would come to fruition… demand and challenges in North America significantly altered the terrain.”
“We’ve got significant challenges in our North American wholesale business,” CEO Kevin Plank admitted. He said the North American wholesale business, “represents 60% of what we do.”
Disclaimer: We have no position in Under Armour Inc Class A (NYSE: UAA) and have not been compensated for this article.