Under Armour Inc on Friday forecast full-year profit below Wall Street estimates, as the sportswear maker grapples with higher costs related to supply chain disruptions and a hit to its business from renewed Covid-19 curbs in China.
Shares of Under Armour were down about 3 percent in premarket trading after the company reported bleak quarterly sales. They shed nearly 33 percent this year.
While economies around the world are reopening, a spike in Covid-19 infections in some parts of the world such as China has led governments to reinstate strict social restrictions once again, hurting store traffic for retailers.
It has impacted sales at Under Armour, which reported a 14 percent fall in revenue from the Asia-Pacific region in the reported quarter.
German sportswear maker Adidas also trimmed its 2022 targets on Friday after its quarterly sales slumped due to Covid-related curbs in Greater China.
Under Armour projected an adjusted profit between 63 cents and 68 cents per share for fiscal year 2023, compared with analysts’ average estimate of 83 cents per share, according to Refinitiv IBES data.
Net revenue rose to $1.30 billion in the quarter ended March 31, from $1.26 billion in the same period a year earlier. Analysts on average were expecting a figure of $1.32 billion, according to Refinitiv IBES.
By Deborah Sophia; Editor: Shinjini Ganguli
Under Armour Inc beat Wall Street estimates for quarterly revenue, as the sportswear maker benefited from strong demand for its athletic wear and higher prices of its hoodies and leggings to counter inflation.