Under Armour Inc’s (UA.N) quarterly sales jumped 30 percent as the company’s new under armour shoes australia by NBA star Stephen Curry and golfer Jordan Spieth were a huge hit with customers.
Shares in the company, that raised its full-year 2016 sales forecast, rose just as much as 8.7 percent in morning trading on Thursday.
Under Armour’s quarterly sales have risen by at the very least 20 % over the past six years, helping the company replace Germany’s Adidas (ADSGn.DE) since the No. 2 sportswear maker in the United States this past year. Nike Inc (NKE.N) is the market leader.
“The recent market fears in regards to the apparel slowdown were unfounded while they demonstrated another quarter of twenty percent growth, and gross margins were far better than we expected,” BB&T Capital Markets analyst Corinna Freedman said.
Under Armour’s sales of sports and outdoor apparel rose 20 percent to $666.6 million inside the first quarter ended March 31, as increasing numbers of customers bought its training and golf clothing. Apparel accounts in excess of 60 % from the company’s total revenue.
Footwear sales jumped 64 percent to $264.2 million on strong requirement for the company’s under armour online, Curry One and Curry Two basketball shoes and Spieth’s newly-launched Drive One golf shoes.
Under Armour stated it expected sales from the second quarter to develop inside the “high 20s” percentage range, and gross margins to become little changed compared to just last year.
Under Armour’s gross margin fell to 45.9 percent from 46.9 percent from the latest quarter, hurt by higher discounts and also the strong dollar. However, margins still topped analysts’ estimate of 45.4 percent, as outlined by Thomson Reuters StarMine.
Freedman said because the company beat 17dexjpky forecast for gross margins, investors could be optimistic that its second-quarter outlook could prove to be conservative.
The under armour shoes sydney raised its full-year sales forecast to around $5. billion from about $4.95 billion. Operating income for 2016 is already anticipated to be $503-$507 million, compared to its prior forecast of about $503 million.