In 2013, Under Armour Inc UAUAA was able to lure NBA superstar Stephen Curry away from contract negotiations with Nike Inc NKE. Curry went on to become a three-time NBA champion and is one of the faces of the company.
This week, Under Armour doubled down on its partnership with Curry.
What To Know: The apparel company is launching the Curry Brand with the Golden State Warriors star. The Curry Brand will launch with footwear, apparel and accessories across the basketball and golf categories.
Expansion into running and women’s products categories are planned for the future of the Curry Brand.
Why It’s Important: Nike has the Jordan Brand, which has annual revenue of $3.5 billion. Under Armour is now putting its emphasis on its first signature standalone brand extension. Curry is recognized as one of the top NBA players and his signature shoe line with Under Armour has been a huge success.
Under Armour has Curry under contract until 2024, so the launch of the Curry Brand could play a big role in keeping him with the company.
“We’re not trying to take on Jordan here, that’s ridiculous,” Under Armour CEO Patrik Frisk said. The CEO said Under Armour is only 25 years old and has only been in footwear for 10 years.
“We’ve got a lot of work to do, and this is a very important initiative for us.”
The expansion into the women’s category could pair well with Curry and his wife Ayesha Curry, who is a bestselling author and has a strong social media following. Curry also told Sports Illustrated additional athletes could be signed to the Curry Brand in the future.
“We have some plans on that but nothing to talk about yet,” Curry said on adding additional athletes.
The Curry Brand is also committed to helping over 100,000 young athletes by 2025 with charitable initiatives part of the brand. This could help Under Armour gain back some of its appeal to consumers who support companies with causes.
What’s Next: Under Armour reported third-quarter figures that beat analyst estimates. The company saw footwear revenue increase 19% in the third quarter, which was higher than Nike’s 4% rise in the same period.
The new Curry signature shoe launches in December, ahead of the launch of the 2020-2021 NBA season.
The launch of the new shoe and the Curry Brand within the fourth quarter could lead to some upside for quarterly results that may not have been baked into analyst projections. The new shoe could help Under Armour outpace Nike in footwear sales again.
Price Action: Shares of Under Armour are up 73% in the last six months, but remain down 23% in 2020.
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