BALTIMORE, Nov. 7, 2024
/PRNewswire/ -- Under Armour, Inc. (NYSE: UAA, UA) announced
unaudited financial results for its second quarter of fiscal 2025,
which ended September 30, 2024.
The company reports its financial performance following accounting
principles generally accepted in the
United States of America ("GAAP"). This press release refers
to "currency neutral" and "adjusted" amounts, which are non-GAAP
financial measures described below under the "Non-GAAP Financial
Information" paragraph.
"Our second quarter fiscal 2025 performance demonstrates that
our strategy to reconstitute the Under Armour brand and establish a
more premium position in the marketplace is gaining traction," said
Under Armour President and CEO Kevin
Plank. "With better-than-expected results, we are pleased to
raise our full-year profitability outlook while simultaneously
increasing marketing investments to amplify our brand."
Plank continued, "We are a fundamentally stronger business today
with increasingly better execution across key dimensions. This
includes more consistent marketplace discipline through
meaningfully improved product, storytelling, and sales leadership,
which will deliver a sharper, unique approach to our brand position
in the years ahead."
Second Quarter Fiscal 2025 Review
- In line with our expectations, revenue was down 11
percent to $1.4 billion (down
10 percent currency neutral).
- North America revenue
decreased 13 percent to $863 million,
and international revenue decreased 6 percent to $538 million (down 5 percent currency neutral).
In the international business, revenue in EMEA was down 1 percent
(down 1 percent currency neutral), down 11 percent in Asia-Pacific (down 10 percent currency
neutral), and down 13 percent in Latin
America (down 4 percent currency neutral).
- Wholesale revenue decreased 12 percent to $826 million, and direct-to-consumer revenue was
down 8 percent to $550 million.
Revenue from owned and operated stores remained flat. Due to
planned decreases in promotional activities, eCommerce revenue
decreased by 21 percent, representing 30 percent of the total
direct-to-consumer business for the quarter.
- Apparel revenue decreased 12 percent to $947 million, footwear revenue was down 11
percent to $313 million, and
accessories revenue was up 2 percent to $116
million.
- Gross margin increased 200 basis points to 49.8 percent,
driven primarily by lower product and freight costs, reduced
discounting levels in the direct-to-consumer business, and a
favorable channel mix.
- Selling, general, and administrative expenses decreased
15 percent to $520 million.
Adjusted selling, general, and administrative expenses
decreased 13 percent to $530 million, which excludes
$13 million in benefits from a
litigation-related insurance recovery and approximately
$3 million in transformation expenses
related to our Fiscal 2025 restructuring program.
- Restructuring charges were $3
million.
- Operating income was $173
million. Excluding the insurance recovery, transformation
expenses, and restructuring charges, adjusted operating
income was $166 million.
- Net income was $170
million. Adjusted net income was $131 million.
- Diluted earnings per share was $0.39. Adjusted diluted earnings per share
was $0.30.
- Inventory decreased 3 percent to $1.1 billion.
- At the end of the quarter, cash and cash equivalents
totaled $531 million, and no
borrowings were outstanding under the company's $1.1 billion revolving credit facility.
Fiscal 2025 Restructuring Plan
In May 2024, Under Armour
announced a restructuring plan designed to strengthen and support
the company's financial and operational efficiencies. Following
further evaluation, in September
2024, the company announced additional restructuring actions
primarily related to the decision to exit one of its distribution
facilities in Rialto, California,
increasing its restructuring plan range to $140 million to $160
million, of which up to $75
million of the charges are anticipated to be cash-related
and up to $85 million are expected to
be non-cash charges. As of the second fiscal quarter of 2025, the
company has recognized $28 million in
restructuring and impairment charges and $11
million in other related transformational expenses under the
plan. Of the total $40 million
incurred to date, $36 million is
cash-related, and $4 million is
non-cash-related. The company anticipates the remainder of the
charges under the updated restructuring plan will occur during
fiscal 2025 and fiscal 2026.
Updated Fiscal 2025 Outlook
Key points related to Under Armour's fiscal 2025 outlook
include:
- Revenue is expected to decline at a low double-digit
percentage rate. This includes a 14 to 16 percent decline in
North America as the company works
to reset this business. The company also expects a low single-digit
percent decline in its international business, with flat results in
EMEA offset by a high single-digit decline in its Asia-Pacific business due to macroeconomic
pressures.
- Gross margin is expected to increase by 125 to 150 basis
points compared to the prior expectation of a 75 to 100 basis point
improvement. This increase is driven primarily by reduced
promotional and discounting activities in the company's
direct-to-consumer business and product costing benefits.
- Selling, general, and administrative expenses are
expected to increase in the mid-to-high single-digit percentage
range, primarily due to litigation settlement expenses. Excluding
the litigation settlement expense, related insurance recoveries,
and anticipated transformation expenses, adjusted
selling, general, and administrative expenses are expected to
decrease at a low-to-mid single-digit percentage rate. This
includes approximately $25 million in
additional marketing investments following better-than-expected
year-to-date profitability performance that will be used to build
the brand over the long term.
- Operating loss is expected to be $176 to $196
million, compared to the previous expectation of
$220 to $240
million. Excluding the midpoint of anticipated restructuring
charges and transformation expenses, litigation settlement
expenses, and related insurance recoveries, adjusted operating
income is expected to be $165 to
$185 million, compared to the prior
expectation of $140 to $160 million.
- Diluted loss per share is expected to be between
$0.48 and $0.51, compared to the prior expectation of
$0.53 to $0.56. Adjusted diluted earnings per share
is expected to be between $0.24 and
$0.27, compared to the previous
expectation of $0.19 to $0.21.
- Capital expenditures are expected to be between
$190 and $210
million, compared to the previous estimate of $200 to $220
million.
Conference Call and Webcast
Under Armour will hold its second quarter fiscal 2025
conference call today at approximately 8:30
a.m. Eastern Time. The call will be webcast live at
https://about.underarmour.com/investor-relations/financials and
archived and available for replay about three hours after the live
event.
Non-GAAP Financial Information
This press release refers to "currency-neutral" and "adjusted"
results, as well as "adjusted" forward-looking estimates of the
company's results for its 2025 fiscal year ending March 31, 2025. Management believes this
information is helpful to investors in comparing the company's
results of operations period-over-period because it enhances
visibility into its actual underlying results, excluding these
impacts. Currency-neutral financial information is calculated to
exclude changes in foreign currency exchange rates. References to
adjusted financial measures exclude the company's litigation
settlement expense (and related insurance recoveries) and the
impact of the company's fiscal year 2025 restructuring plan,
related charges, and related tax effects. Management believes these
adjustments are not core to the company's operations. The
reconciliation of non-GAAP amounts to the most directly comparable
financial measure calculated according to GAAP is presented in
supplemental financial information furnished with this release. All
per-share amounts are reported on a diluted basis. These
supplemental non-GAAP financial measures should not be considered
in isolation. They should be contemplated in addition to, and not
as an alternative to, the company's reported results prepared per
GAAP. Additionally, the company's non-GAAP financial information
may not be comparable to similarly titled measures reported by
other companies.
About Under Armour, Inc.
Under Armour, Inc., headquartered in Baltimore, Maryland, is a leading inventor,
marketer, and distributor of branded athletic performance apparel,
footwear, and accessories. Designed to empower human performance,
Under Armour's innovative products and experiences are engineered
to make athletes better. For further information, please visit
http://about.underarmour.com.
Forward-Looking Statements
Some of the statements contained in this press release
constitute forward-looking statements. Forward-looking statements
relate to expectations, beliefs, projections, future plans and
strategies, anticipated events or trends, and similar expressions
concerning matters that are not historical facts, such as
statements regarding our share repurchase program, our future
financial condition or results of operations, our prospects and
strategies for future growth, potential restructuring efforts,
including the scope of these restructuring efforts and the amount
of potential charges and costs, the timing of these measures, and
the anticipated benefits of our restructuring plans, expectations
regarding promotional activities, freight, product cost pressures,
and foreign currency impacts, the impact of global economic
conditions and inflation on our results of operations, our
liquidity and use of capital resources, the development and
introduction of new products, the implementation of our marketing
and branding strategies, the future benefits and opportunities from
significant investments, and the impact of litigation or other
proceedings. In many cases, you can identify forward-looking
statements by terms such as "may," "will," "could," "should,"
"expects," "plans," "anticipates," "believes," "estimates,"
"predicts," "outlook," "potential," or the negative of these terms
or other comparable terminology. The forward-looking statements in
this press release reflect our current views about future events.
They are subject to risks, uncertainties, assumptions, and changes
in circumstances that may cause events or our actual activities or
results to differ significantly from those expressed in any
forward-looking statement. Although we believe the expectations
reflected in the forward-looking statements are reasonable, they
are inherently uncertain. We cannot guarantee future events,
results, actions, activity levels, performance, or achievements.
Readers are cautioned not to place undue reliance on these
forward-looking statements. Several important factors could cause
actual results to differ materially from those indicated by these
forward-looking statements, including, but not limited to: changes
in general economic or market conditions, including increasing
inflation, that could affect overall consumer spending or our
industry; increased competition causing us to lose market share or
reduce the prices of our products or increase our marketing efforts
significantly; fluctuations in the costs of raw materials and
commodities we use in our products and our supply chain (including
labor); our ability to successfully execute our long-term
strategies; our ability to effectively drive operational efficiency
in our business; changes in the financial health of our customers;
our ability to effectively develop and launch new, innovative, and
updated products; our ability to accurately forecast consumer
shopping and engagement preferences and consumer demand for our
products and manage our inventory in response to changing demands;
our ability to successfully execute any potential restructuring
plans and realize their expected benefits; our ability to comply
with existing trade and other regulations, and the potential impact
of new trade, tariff, and tax regulations on our profitability;
loss of key customers, suppliers, or manufacturers; our ability to
further expand our business globally and drive brand awareness and
consumer acceptance of our products in other countries; our ability
to manage the increasingly complex operations of our global
business; the impact of global events beyond our control, including
military conflicts; the impact of global or regional public health
emergencies on our industry and our business, financial condition,
and results of operations, including impacts on the global supply
chain; our ability to successfully manage or realize expected
results from significant transactions and investments; our ability
to effectively market and maintain a positive brand image; our
ability to attract key talent and retain the services of our senior
management and other key employees; our ability to effectively meet
regulatory requirements and stakeholder expectations with respect
to sustainability and social matters; the availability,
integration, and effective operation of information systems and
other technology, as well as any potential interruption of such
systems or technology; any disruptions, delays, or deficiencies in
the design, implementation, or application of our global operating
and financial reporting information technology system; our ability
to access capital and financing required to manage our business on
terms acceptable to us; our ability to accurately anticipate and
respond to seasonal or quarterly fluctuations in our operating
results; risks related to foreign currency exchange rate
fluctuations; risks related to data security or privacy breaches;
and our potential exposure to and the financial impact of
litigation and other proceedings. The forward-looking statements
here reflect our views and assumptions only as of the date of this
press release. We undertake no obligation to update any
forward-looking statement to reflect events or circumstances after
the date on which the statement is made or to reflect unanticipated
events.
As previously disclosed, during Fiscal 2024,
we identified and corrected certain accounting errors, primarily
related to the cost of goods sold and selling, general and
administrative expenses on the Consolidated Statement of
Operations, and corresponding impacts to our other Consolidated
Financial Statements. The impacts of these revisions were not
material to our previously filed financial statements. Information
presented in the tables below for the three and six months ended
September 30, 2023 has been revised
to reflect these corrections. See Note 1 to the company's Condensed
Consolidated Financial Statements included in Part I, Item 1 of the
Company's Quarterly Report on Form 10-Q for the three and six
months ended September 30, 2024, to
be filed with the Securities and Exchange Commission.
|
Under Armour,
Inc.
For the Three and Six
Months Ended September 30, 2024, and 2023
(Unaudited; in
thousands, except per share amounts)
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATION
|
|
|
|
|
|
Three Months Ended
September 30,
|
|
Six Months Ended
September 30,
|
|
in '000s
|
2024
|
|
% of Net
Revenues
|
|
2023
|
|
% of Net
Revenues
|
|
2024
|
|
% of Net
Revenues
|
|
2023
|
|
% of Net
Revenues
|
|
Net revenues
|
$
1,399,023
|
|
100.0 %
|
|
$
1,566,674
|
|
100.0 %
|
|
$
2,582,688
|
|
100.0 %
|
|
$
2,883,639
|
|
100.0 %
|
|
Cost of goods
sold
|
702,891
|
|
50.2 %
|
|
818,151
|
|
52.2 %
|
|
1,323,881
|
|
51.3 %
|
|
1,523,621
|
|
52.8 %
|
|
Gross
profit
|
696,132
|
|
49.8 %
|
|
748,523
|
|
47.8 %
|
|
1,258,807
|
|
48.7 %
|
|
1,360,018
|
|
47.2 %
|
|
Selling, general and
administrative expenses
|
519,840
|
|
37.2 %
|
|
609,050
|
|
38.9 %
|
|
1,357,157
|
|
52.5 %
|
|
1,198,122
|
|
41.5 %
|
|
Restructuring
charges
|
3,212
|
|
0.2 %
|
|
—
|
|
— %
|
|
28,298
|
|
1.1 %
|
|
—
|
|
— %
|
|
Income (loss) from
operations
|
173,080
|
|
12.4 %
|
|
139,473
|
|
8.9 %
|
|
(126,648)
|
|
(4.9) %
|
|
161,896
|
|
5.6 %
|
|
Interest income
(expense), net
|
(1,747)
|
|
(0.1) %
|
|
(373)
|
|
— %
|
|
597
|
|
— %
|
|
(1,999)
|
|
(0.1) %
|
|
Other income (expense),
net
|
(3,420)
|
|
(0.2) %
|
|
(6,104)
|
|
(0.4) %
|
|
(6,150)
|
|
(0.2) %
|
|
(12,164)
|
|
(0.4) %
|
|
Income (loss) before
income taxes
|
167,913
|
|
12.0 %
|
|
132,996
|
|
8.5 %
|
|
(132,201)
|
|
(5.1) %
|
|
147,733
|
|
5.1 %
|
|
Income tax expense
(benefit)
|
(2,136)
|
|
(0.2) %
|
|
28,436
|
|
1.8 %
|
|
3,013
|
|
0.1 %
|
|
32,764
|
|
1.1 %
|
|
Income (loss) from
equity method investments
|
333
|
|
— %
|
|
151
|
|
— %
|
|
170
|
|
— %
|
|
(248)
|
|
— %
|
|
Net income
(loss)
|
$
170,382
|
|
12.2 %
|
|
$
104,711
|
|
6.7 %
|
|
$
(135,044)
|
|
(5.2) %
|
|
$
114,721
|
|
4.0 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic net income (loss)
per share of Class A, B and C common stock
|
$ 0.39
|
|
|
|
$ 0.24
|
|
|
|
$ (0.31)
|
|
|
|
$ 0.26
|
|
|
|
Diluted net income
(loss) per share of Class A, B and C common stock
|
$ 0.39
|
|
|
|
$ 0.23
|
|
|
|
$ (0.31)
|
|
|
|
$ 0.25
|
|
|
|
Weighted average
common shares outstanding Class A, B and C common
stock
|
|
|
|
|
|
|
|
|
|
Basic
|
432,225
|
|
|
|
443,525
|
|
|
|
433,950
|
|
|
|
444,195
|
|
|
|
Diluted
|
435,685
|
|
|
|
453,715
|
|
|
|
433,950
|
|
|
|
454,107
|
|
|
|
Under Armour,
Inc.
For the Three and Six
Months Ended September 30, 2024, and 2023
(Unaudited; in
thousands)
NET REVENUES BY
SEGMENT
|
|
|
|
|
|
Three Months Ended
September 30,
|
|
Six Months Ended
September 30,
|
|
in '000s
|
2024
|
|
2023
|
|
% Change
|
|
2024
|
|
2023
|
|
% Change
|
|
North
America
|
$
863,345
|
|
$
991,357
|
|
(12.9) %
|
|
$
1,572,605
|
|
$
1,817,962
|
|
(13.5) %
|
|
EMEA
|
283,178
|
|
287,091
|
|
(1.4) %
|
|
510,070
|
|
513,732
|
|
(0.7) %
|
|
Asia-Pacific
|
207,661
|
|
232,065
|
|
(10.5) %
|
|
389,497
|
|
434,297
|
|
(10.3) %
|
|
Latin
America
|
46,941
|
|
53,669
|
|
(12.5) %
|
|
111,350
|
|
109,408
|
|
1.8 %
|
|
Corporate Other
(1)
|
(2,102)
|
|
2,492
|
|
(184.3) %
|
|
(834)
|
|
8,240
|
|
(110.1) %
|
|
Total net
revenues
|
$
1,399,023
|
|
$
1,566,674
|
|
(10.7) %
|
|
$
2,582,688
|
|
$
2,883,639
|
|
(10.4) %
|
|
NET REVENUES BY
DISTRIBUTION CHANNEL
|
|
|
|
|
|
Three Months Ended
September 30,
|
|
Six Months Ended
September 30,
|
|
in '000s
|
2024
|
|
2023
|
|
% Change
|
|
2024
|
|
2023
|
|
% Change
|
|
Wholesale
|
$
825,993
|
|
$
939,725
|
|
(12.1) %
|
|
$
1,506,506
|
|
$
1,681,683
|
|
(10.4) %
|
|
Direct-to-consumer
|
550,336
|
|
595,811
|
|
(7.6) %
|
|
1,030,549
|
|
1,139,998
|
|
(9.6) %
|
|
Net
Sales
|
1,376,329
|
|
1,535,536
|
|
(10.4) %
|
|
2,537,055
|
|
2,821,681
|
|
(10.1) %
|
|
License
revenues
|
24,796
|
|
28,646
|
|
(13.4) %
|
|
46,467
|
|
53,718
|
|
(13.5) %
|
|
Corporate Other
(1)
|
(2,102)
|
|
2,492
|
|
(184.3) %
|
|
(834)
|
|
8,240
|
|
(110.1) %
|
|
Total net
revenues
|
$
1,399,023
|
|
$
1,566,674
|
|
(10.7) %
|
|
$
2,582,688
|
|
$
2,883,639
|
|
(10.4) %
|
|
NET REVENUES BY
PRODUCT CATEGORY
|
|
|
|
|
|
Three Months Ended
September 30,
|
|
Six Months Ended
September 30,
|
|
in '000s
|
2024
|
|
2023
|
|
% Change
|
|
2024
|
|
2023
|
|
% Change
|
|
Apparel
|
$
947,188
|
|
$
1,070,401
|
|
(11.5) %
|
|
$
1,704,980
|
|
$
1,895,014
|
|
(10.0) %
|
|
Footwear
|
312,760
|
|
351,202
|
|
(10.9) %
|
|
623,149
|
|
714,872
|
|
(12.8) %
|
|
Accessories
|
116,381
|
|
113,933
|
|
2.1 %
|
|
208,926
|
|
211,795
|
|
(1.4) %
|
|
Net
Sales
|
1,376,329
|
|
1,535,536
|
|
(10.4) %
|
|
2,537,055
|
|
2,821,681
|
|
(10.1) %
|
|
Licensing
revenues
|
24,796
|
|
28,646
|
|
(13.4) %
|
|
46,467
|
|
53,718
|
|
(13.5) %
|
|
Corporate Other
(1)
|
(2,102)
|
|
2,492
|
|
(184.3) %
|
|
(834)
|
|
8,240
|
|
(110.1) %
|
|
Total net
revenues
|
$
1,399,023
|
|
$
1,566,674
|
|
(10.7) %
|
|
$
2,582,688
|
|
$
2,883,639
|
|
(10.4) %
|
|
|
(1) Corporate Other
primarily includes net revenues from foreign currency hedge gains
and losses generated by entities within the company's operating
segments but managed through its central foreign exchange risk
management program.
|
|
Under Armour,
Inc.
For the Three and Six
Months Ended September 30, 2024, and 2023
(Unaudited; in
thousands)
INCOME (LOSS) FROM
OPERATIONS BY SEGMENT
|
|
|
|
|
|
Three Months Ended
September 30,
|
|
Six Months Ended
September 30,
|
|
in '000s
|
2024
|
|
% of Net
Revenues (1)
|
|
2023
|
|
% of Net
Revenues (1)
|
|
2024
|
|
% of Net
Revenues (1)
|
|
2023
|
|
% of Net
Revenues (1)
|
|
North
America
|
$
217,259
|
|
25.2 %
|
|
$
211,071
|
|
21.3 %
|
|
$
365,148
|
|
23.2 %
|
|
$
371,785
|
|
20.5 %
|
|
EMEA
|
51,595
|
|
18.2 %
|
|
38,826
|
|
13.5 %
|
|
72,051
|
|
14.1 %
|
|
68,605
|
|
13.4 %
|
|
Asia-Pacific
|
34,214
|
|
16.5 %
|
|
54,608
|
|
23.5 %
|
|
44,149
|
|
11.3 %
|
|
70,006
|
|
16.1 %
|
|
Latin
America
|
12,171
|
|
25.9 %
|
|
13,615
|
|
25.4 %
|
|
27,342
|
|
24.6 %
|
|
19,392
|
|
17.7 %
|
|
Corporate Other
(2)
|
(142,159)
|
|
NM
|
|
(178,647)
|
|
NM
|
|
(635,338)
|
|
NM
|
|
(367,892)
|
|
NM
|
|
Income (loss) from
operations
|
$
173,080
|
|
12.4 %
|
|
$
139,473
|
|
8.9 %
|
|
$
(126,648)
|
|
(4.9) %
|
|
$
161,896
|
|
5.6 %
|
|
|
(1) The percentage of
operating income (loss) is calculated based on total segment net
revenues. The operating income (loss) percentage for Corporate
Other is not presented as a meaningful metric (NM).
|
|
(2) Corporate Other
primarily includes net revenues from foreign currency hedge gains
and losses generated by entities within the company's operating
segments but managed through its central foreign exchange risk
management program. Corporate Other also includes expenses related
to the company's central supporting functions.
|
|
Under Armour,
Inc.
As of
September 30, 2024, and March 31, 2024
(Unaudited; in
thousands)
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
|
|
|
|
|
|
in '000s
|
|
September 30,
2024
|
|
March 31,
2024
|
|
Assets
|
|
|
|
|
|
Current
assets
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
530,701
|
|
$
858,691
|
|
Accounts receivable,
net
|
|
723,042
|
|
757,339
|
|
Inventories
|
|
1,105,884
|
|
958,495
|
|
Prepaid expenses and
other current assets, net
|
|
210,109
|
|
289,157
|
|
Total current
assets
|
|
2,569,736
|
|
2,863,682
|
|
Property and equipment,
net
|
|
677,400
|
|
664,503
|
|
Operating lease
right-of-use assets
|
|
415,386
|
|
434,699
|
|
Goodwill
|
|
495,029
|
|
478,302
|
|
Intangible assets,
net
|
|
6,092
|
|
7,000
|
|
Deferred income
taxes
|
|
241,502
|
|
221,033
|
|
Other long-term
assets
|
|
89,448
|
|
91,515
|
|
Total
assets
|
|
$
4,494,593
|
|
$
4,760,734
|
|
Liabilities and
Stockholders' Equity
|
|
|
|
|
|
Current maturities of
long-term debt
|
|
$
—
|
|
$
80,919
|
|
Accounts
payable
|
|
562,582
|
|
483,731
|
|
Accrued
expenses
|
|
292,259
|
|
287,853
|
|
Customer refund
liabilities
|
|
144,983
|
|
139,283
|
|
Operating lease
liabilities
|
|
135,691
|
|
139,331
|
|
Other current
liabilities
|
|
45,614
|
|
34,344
|
|
Total current
liabilities
|
|
1,181,129
|
|
1,165,461
|
|
Long-term debt, net of
current maturities
|
|
594,592
|
|
594,873
|
|
Operating lease
liabilities, non-current
|
|
601,497
|
|
627,665
|
|
Other long-term
liabilities
|
|
132,174
|
|
219,449
|
|
Total
liabilities
|
|
2,509,392
|
|
2,607,448
|
|
Total stockholders'
equity
|
|
1,985,201
|
|
2,153,286
|
|
Total liabilities
and stockholders' equity
|
|
$
4,494,593
|
|
$
4,760,734
|
|
Under Armour,
Inc.
For the Six Months
Ended September 30, 2024 and 2023
(Unaudited; in
thousands)
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
|
|
Six Months Ended
September 30,
|
|
2024
|
|
2023
|
|
Cash flows from
operating activities
|
|
|
|
|
Net income
(loss)
|
$
(135,044)
|
|
$
114,721
|
|
Adjustments to
reconcile net income (loss) to net cash provided by (used in)
operating activities
|
|
|
|
|
Depreciation and
amortization
|
65,565
|
|
68,287
|
|
Unrealized foreign
currency exchange rate (gain) loss
|
(14,535)
|
|
21,145
|
|
Loss on disposal of
property and equipment
|
2,598
|
|
696
|
|
Non-cash restructuring
and impairment charges
|
3,679
|
|
—
|
|
Amortization of bond
premium and debt issuance costs
|
1,107
|
|
1,096
|
|
Stock-based
compensation
|
28,468
|
|
23,357
|
|
Deferred income
taxes
|
(6,400)
|
|
(10,788)
|
|
Changes in reserves
and allowances
|
(607)
|
|
18,471
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
Accounts
receivable
|
31,461
|
|
(51,327)
|
|
Inventories
|
(144,058)
|
|
30,034
|
|
Prepaid expenses and
other assets
|
23,950
|
|
(13,421)
|
|
Other non-current
assets
|
9,428
|
|
47,671
|
|
Accounts
payable
|
73,733
|
|
(120,353)
|
|
Accrued expenses and
other liabilities
|
(107,102)
|
|
(71,161)
|
|
Customer refund
liabilities
|
5,671
|
|
(11,244)
|
|
Income taxes payable
and receivable
|
(6,323)
|
|
8,299
|
|
Net cash provided by
(used in) operating activities
|
(168,409)
|
|
55,483
|
|
Cash flows from
investing activities
|
|
|
|
|
Purchases of property
and equipment
|
(91,503)
|
|
(75,384)
|
|
Sale of MyFitnessPal
platform
|
50,000
|
|
45,000
|
|
Sale of MapMyFitness
platform
|
8,000
|
|
—
|
|
Purchase of UNLESS
COLLECTIVE, Inc., net of cash acquired
|
(9,788)
|
|
—
|
|
Net cash provided by
(used in) investing activities
|
(43,291)
|
|
(30,384)
|
|
Cash flows from
financing activities
|
|
|
|
|
Common shares
repurchased
|
(40,000)
|
|
(50,000)
|
|
Repayment of long-term
debt
|
(80,919)
|
|
—
|
|
Employee taxes paid for
shares withheld for income taxes
|
(8,399)
|
|
(2,318)
|
|
Proceeds from exercise
of stock options and other stock issuances
|
1,314
|
|
1,781
|
|
Payments of debt
financing costs
|
(1,388)
|
|
—
|
|
Net cash provided by
(used in) financing activities
|
(129,392)
|
|
(50,537)
|
|
Effect of exchange rate
changes on cash, cash equivalents and restricted cash
|
14,023
|
|
(28,671)
|
|
Net increase
(decrease) in cash, cash equivalents and restricted cash
|
(327,069)
|
|
(54,109)
|
|
Cash, cash
equivalents and restricted cash
|
|
|
|
|
Beginning of
period
|
876,917
|
|
726,745
|
|
End of
period
|
$
549,848
|
|
$
672,636
|
|
Under Armour,
Inc.
For the Three and Six
Months Ended September 30, 2024
(Unaudited)
|
|
|
The table below
presents the reconciliation of net revenue growth (decline)
calculated according to GAAP to currency-
neutral net revenue, a non-GAAP measure. For further information
regarding the company's use of non-GAAP financial
measures, see "Non-GAAP Financial Information"
above.
|
|
|
CURRENCY-NEUTRAL NET
REVENUE GROWTH (DECLINE) RECONCILIATION
|
|
|
|
|
|
Three Months Ended
September 30, 2024
|
|
Six Months Ended
September 30, 2024
|
|
Total Net
Revenue
|
|
|
|
|
Net revenue growth -
GAAP
|
(10.7) %
|
|
(10.4) %
|
|
Foreign exchange
impact
|
0.5 %
|
|
0.3 %
|
|
Currency neutral net
revenue growth - Non-GAAP
|
(10.2) %
|
|
(10.1) %
|
|
|
|
|
|
North
America
|
|
|
|
|
Net revenue growth -
GAAP
|
(12.9) %
|
|
(13.5) %
|
|
Foreign exchange
impact
|
0.3 %
|
|
0.2 %
|
|
Currency neutral net
revenue growth - Non-GAAP
|
(12.6) %
|
|
(13.3) %
|
|
|
|
|
|
EMEA
|
|
|
|
|
Net revenue growth -
GAAP
|
(1.4) %
|
|
(0.7) %
|
|
Foreign exchange
impact
|
— %
|
|
(0.2) %
|
|
Currency neutral net
revenue growth - Non-GAAP
|
(1.4) %
|
|
(0.9) %
|
|
|
|
|
|
Asia-Pacific
|
|
|
|
|
Net revenue growth -
GAAP
|
(10.5) %
|
|
(10.3) %
|
|
Foreign exchange
impact
|
0.2 %
|
|
1.4 %
|
|
Currency neutral net
revenue growth - Non-GAAP
|
(10.3) %
|
|
(8.9) %
|
|
|
|
|
|
Latin
America
|
|
|
|
|
Net revenue growth -
GAAP
|
(12.5) %
|
|
1.8 %
|
|
Foreign exchange
impact
|
8.7 %
|
|
2.3 %
|
|
Currency neutral net
revenue growth - Non-GAAP
|
(3.8) %
|
|
4.1 %
|
|
|
|
|
|
Total
International
|
|
|
|
|
Net revenue growth -
GAAP
|
(6.1) %
|
|
(4.4) %
|
|
Foreign exchange
impact
|
0.9 %
|
|
0.7 %
|
|
Currency neutral net
revenue growth - Non-GAAP
|
(5.2) %
|
|
(3.7) %
|
|
Under Armour,
Inc.
For the Three and Six
Months Ended September 30, 2024
(Unaudited; in
thousands, except per share amounts)
|
|
|
The tables below
present the reconciliation of the company's condensed consolidated
statement of operations in
accordance with GAAP to certain adjusted non-GAAP financial
measures discussed in this press release. For further
information regarding the company's use of non-GAAP financial
measures, see "Non-GAAP Financial Information"
above.
|
|
|
ADJUSTED SELLING
GENERAL AND ADMINISTRATIVE EXPENSES
|
|
|
|
|
|
in '000s
|
Three months ended
September 30, 2024
|
|
Six months ended
September 30, 2024
|
|
GAAP selling, general
and administrative expenses
|
$
519,840
|
|
$
1,357,157
|
|
Add: Impact of
litigation settlement
|
12,954
|
|
(261,046)
|
|
Add: Impact of
restructuring-related transformational expenses
|
(2,724)
|
|
(11,381)
|
|
Adjusted selling,
general and administrative expenses
|
$
530,070
|
|
$
1,084,730
|
|
ADJUSTED OPERATING
INCOME (LOSS) RECONCILIATION
|
|
|
|
|
|
in '000s
|
Three months ended
September 30, 2024
|
|
Six months ended
September 30, 2024
|
|
GAAP income (loss) from
operations
|
$
173,080
|
|
$
(126,648)
|
|
Add: Impact of
litigation settlement
|
(12,954)
|
|
261,046
|
|
Add: Impact of
restructuring charges
|
3,212
|
|
28,298
|
|
Add: Impact of
restructuring-related transformational expenses
|
2,724
|
|
11,381
|
|
Adjusted income from
operations
|
$
166,062
|
|
$
174,077
|
|
ADJUSTED NET INCOME
(LOSS) RECONCILIATION
|
|
|
|
|
|
in '000s
|
Three months ended
September 30, 2024
|
|
Six months ended
September 30, 2024
|
|
GAAP net income
(loss)
|
$
170,382
|
|
$
(135,044)
|
|
Add: Impact of
litigation settlement
|
(12,954)
|
|
261,046
|
|
Add: Impact of
restructuring charges
|
3,212
|
|
28,298
|
|
Add: Impact of
restructuring-related transformational expenses
|
2,724
|
|
11,381
|
|
Add: Impact of
provision for income taxes
|
(32,250)
|
|
(30,911)
|
|
Adjusted net
income
|
$
131,114
|
|
$
134,770
|
|
ADJUSTED DILUTED
EARNINGS (LOSS) PER SHARE RECONCILIATION
|
|
|
|
|
|
Three months ended
September 30, 2024
|
|
Six months ended
September 30, 2024
|
|
GAAP diluted net income
(loss) per share
|
$
0.39
|
|
$
(0.31)
|
|
Add: Impact of
litigation settlement
|
(0.03)
|
|
0.60
|
|
Add: Impact of
restructuring charges
|
0.01
|
|
0.06
|
|
Add: Impact of
restructuring-related transformational expenses
|
0.01
|
|
0.03
|
|
Add: Impact of
provision for income taxes
|
(0.08)
|
|
(0.07)
|
|
Adjusted diluted net
income per share
|
$
0.30
|
|
$
0.31
|
|
Under Armour,
Inc.
Outlook for the Year
Ended March 31, 2025
(Unaudited; in
millions, except per share amounts)
|
|
|
The tables below
reconcile the company's condensed consolidated statement of
operations, presented in accordance
with GAAP, to certain adjusted non-GAAP financial measures
discussed in this press release. For further information
regarding the company's use of non-GAAP financial measures, see
"Non-GAAP Financial Information" above.
|
|
|
ADJUSTED OPERATING
INCOME RECONCILIATION
|
|
|
|
|
(in
millions)
|
|
Year Ending March 31,
2025
|
|
|
Low end of
estimate
|
|
High end of
estimate
|
|
GAAP loss from
operations
|
|
$
(196)
|
|
$
(176)
|
|
Add: Impact of
litigation settlement
|
|
261
|
|
261
|
|
Add: Impact of charges
under 2025 restructuring plan (1)
|
|
100
|
|
100
|
|
Adjusted income from
operations
|
|
$
165
|
|
$
185
|
|
ADJUSTED DILUTED
(LOSS) EARNINGS PER SHARE RECONCILIATION
|
|
|
|
|
|
Year Ending March 31,
2025
|
|
|
Low end of
estimate
|
|
High end of
estimate
|
|
GAAP diluted net loss
per share
|
|
$
(0.51)
|
|
$
(0.48)
|
|
Add: Impact of
litigation settlement
|
|
0.60
|
|
0.60
|
|
Add: Impact of charges
under 2025 restructuring plan (1)
|
|
0.23
|
|
0.23
|
|
Add: Impact of
provision for income taxes
|
|
(0.08)
|
|
(0.08)
|
|
Adjusted diluted net
income per share
|
|
$
0.24
|
|
$
0.27
|
|
|
(1) The estimated fiscal
2025 impact of the restructuring plan presented above assumes the
midpoint of the Company's estimated range of fiscal 2025
restructuring and related charges under the total plan of $140-160
million.
|
|
Under Armour,
Inc.
Outlook for the Quarter
Ended December 31, 2024
(Unaudited; in
millions, except per share amounts)
|
|
|
The tables below
reconcile the company's third quarter fiscal 2025 outlook,
presented in accordance with GAAP, to
certain adjusted non-GAAP financial measures discussed in this
press release. For further information regarding the
company's use of non-GAAP financial measures, see "Non-GAAP
Financial Information" above.
|
|
|
ADJUSTED OPERATING
INCOME RECONCILIATION
|
|
|
|
|
(in
millions)
|
|
Quarter Ending December
31, 2024
|
|
|
Low end of
estimate
|
|
High end of
estimate
|
|
GAAP income from
operations
|
|
$
(13)
|
|
$
(3)
|
|
Add: Estimated impact
of charges under 2025 restructuring plan
|
|
33
|
|
33
|
|
Adjusted income from
operations
|
|
$
20
|
|
$
30
|
|
ADJUSTED DILUTED
(LOSS) EARNINGS PER SHARE RECONCILIATION
|
|
|
|
|
|
Quarter Ending December
31, 2024
|
|
|
Low end of
estimate
|
|
High end of
estimate
|
|
GAAP diluted net income
per share
|
|
$
(0.07)
|
|
$
(0.05)
|
|
Add: Estimated impact
of charges under 2025 restructuring plan
|
|
0.08
|
|
0.08
|
|
Add: Impact of
provision for income taxes
|
|
0.01
|
|
0.01
|
|
Adjusted diluted net
income per share
|
|
$
0.02
|
|
$
0.04
|
|
Under Armour,
Inc.
As of September 30,
2024, and 2023
COMPANY-OWNED &
OPERATED DOOR COUNT
|
|
|
|
|
|
September
30,
|
|
|
2024
|
|
2023
|
|
Factory
House
|
|
180
|
|
178
|
|
Brand House
|
|
16
|
|
19
|
|
North
America total doors
|
|
196
|
|
197
|
|
|
|
|
|
|
Factory
House
|
|
177
|
|
172
|
|
Brand House
|
|
73
|
|
81
|
|
International total doors
|
|
250
|
|
253
|
|
|
|
|
|
|
Factory
House
|
|
357
|
|
350
|
|
Brand House
|
|
89
|
|
100
|
|
Total
doors
|
|
446
|
|
450
|
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SOURCE Under Armour, Inc.
