Under Armour Inc (NYSE:UAA) shares slumped in pre-market trade on Tuesday after the sportswear maker posted mixed third quarter results and lowered its full-year expectations.
The Washington DC-based group blamed a “difficult backdrop” in North America –its largest market in terms of sales – as revenues slipped 5% to US$1.4bn, below expectations of US$1.48bn.
Earnings per share surprised on the upside, coming in at US$0.22, ahead of Wall Street forecasts for US$0.19.
The continued slump in North America offset decent growth in Under Armour’s international markets, with Asia Pacific sales particularly impressive, rising 53% year-on-year.
Given the weak performance of its key home market, the company – founded in the mid-90s by chief executive Kevin Plank – slashed its full-year adjusted earnings per share to between US$0.18 and US$0.20 from its previous range of US$0.37 to US$0.40.
It is the latest in a string of setbacks for Under Armour, which only this week has had to deal with delays in the launch of its latest basketball sneaker – the Curry 4.
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On top of the concerns over the nascent footwear business, Under Armour has also had to contend with slowing growth and its first net losses over the past 12 months or so.
US rival and the world’s largest sports brand, Nike Inc (NYSE:NKE) has also struggled in the US, although Germany’s Adidas has been taking a bigger slice of the pie in the States recently.
"While our international business continues to deliver against our ambition of building a global brand, operational challenges and lower demand in North America resulted in third quarter revenue that was below our expectations," said chairman and chief executive Kevin Plank.
"Based on these issues in our largest market, we believe it is prudent to reduce our sales and earnings outlook for the remainder of 2017."
Shares were down 17.8% to US$13.49 in pre-market trade, their lowest level for eight years. In the regular session, they lost 14.27% to US$14.06 each.