BALTIMORE (AP) — Shares of Under Armour shot up more than 25 percent in midday trading, suggesting investors think the company may be turning things around after a rough three years.
The athletic apparel company, which just a few years ago was seen as a potential rival to industry leader Nike, reported third-quarter net income of $75.3 million, better than expected and easily surpassing the $54.2 million for the same quarter last year.
The company reported third-quarter earnings of 25 cents per share, also easily beating Wall Street expectations. The average estimate of 17 analysts surveyed by Zacks was for earnings of 12 cents per share. The company earned 12 cents per share in the same period last year.
Last month, Under Armour said it would cut about 400 jobs, part of a restructuring that the sports gear maker announced earlier this year.
The Baltimore company began streamlining last year after explosive sales growth petered out as consumers shifted some of their dollars toward active lifestyle brands like Lululemon. Investors also soured on the company, which saw its shares fall to around $11 last year from a high of more than $50 in 2015.
Under Armour reported a revenue increase of 2 percent to $1.44 billion for the quarter, which also beat expectations and last year’s $1.41 billion.
Under Armour said its North American business in the third quarter fell less than expected at 2 percent. That was somewhat offset by 15 percent growth in its international business, which accounted for nearly a quarter of the company’s revenue this period.
Wholesale revenue increased 4 percent to $914 million. Revenue from apparel, led by growth in training, golf and team sports, saw a similar 4 percent increase to $978 million.
The company expects 2018 revenue to increase 3 to 4 percent, unchanged from last quarter’s projection.
Shares in Under Armour rose about 26 percent to $22.94 in midday trading and are up 60 percent in the year to date, though are still short of their 2018 high of $24.31.
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