In this news, we discuss the Under Armour sees annual revenue above expectations, to sell MyFitnessPal.
(Reuters) – Under Armor Inc UA.NUAA.N on Friday announced annual revenues that exceeded Wall Street expectations as a pandemic trend towards outdoor exercise led to increased demand for running shoes and shoes. other fitness equipment.
Shares of the Baltimore-based company rose 7% in pre-market trading, after it also decided to sell its fitness tracking platform MyFitnessPal for $ 345 million to private equity firm Francisco Partners .
As gym attendance declines due to the risk of the coronavirus spreading further in closed spaces, more people have chosen to work out at home, run or cycle outdoors , increasing sales of the Under Armor line of HOVR training shoes as well as running shorts and t-shirts.
The company’s footwear revenue increased 19% to nearly $ 300 million in the third quarter. Biggest rival Nike Inc NKE.N had posted a 4% increase in shoe revenue in its most recent quarter.
Like Nike, much of the new demand for Under Armor comes from its site Web and its app, which boosted its direct-to-consumer sales activity by 17%.
Overall quarterly revenue was largely flat at $ 1.43 billion for the quarter ended Sept. 30, but topped average analysts’ estimates of $ 1.16 billion.
Excluding certain items, Under Armor gained 26 cents per share, beating expectations of 3 cents per share.
The company said the sale of MyFitnessPal, which it bought in 2015 for $ 475 million, gave it more investment power and simplified its larger digital fitness business.
According to IBES data from Refinitiv, analysts predict a drop in revenue for the full year in the percentage of high teens, compared to analysts’ average estimate of a drop of 25.7%.
The company said it expects an adjusted annual loss of 47 cents per share to 49 cents per share, lower than the loss of 72 cents per share estimated by analysts.
Reporting by Uday Sampath in Bengaluru; Editing by Saumyadeb Chakrabarty and Arun Koyyur
Original © Thomson Reuters