Shares of Under Armour were making gains Friday after the apparel brand reported third-quarter sales and earnings beats, announced the sale of MyFitnessPal and provided better-than-expected guidance.
Under Armour's Q3: Under Armour Inc UAA reported revenue of $1.4 billion for the third quarter, which was flat year-over year.
The company saw wholesale revenue decline 7% year-over-year to $830 million. Direct-to-consumer revenue was up 17% year-over-year to $540 million.
Apparel sales were down 6% year-over-year. Footwear sales were up 19% year-over-year. Accessories were up 23% year-over-year.
Under Armour reported adjusted net income of $118 million and earnings per share of 29 cents.
Under Armour's footwear revenue growth bested Nike Inc NKE, which saw a 4% rise in footwear for its last reported quarter.
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Under Armour Sells MyFitnessPal For $345M: Along with its quarterly earnings, Under Armour announced it will sell its MyFitnessPal connected fitness brand.
MyFitnessPal will be sold for $345 million to Francisco Partners, plus potential earn-out payments, Under Armour said.
Under Armour acquired MyFItnessPal for $475 million in 2015.
The connected fitness segment reported third-quarter sales of $36.9 million, down 6% year-over-year.
The segment saw sales of $102.6 million over the first nine months of the fiscal year.
The transaction is expected to close in the fourth quarter.
Selling MyFitnessPal will give Under Armour more “investment Under Armour’s Outlook: The company expects full-year earnings per share to come in a range of negative 49 cents to negative 47 cents, better than the Street expectation of a 73-cent loss.
Under Armour expects revenue for the full year to decline in the high teens percentage, compared to analyst estimates of a 25% drop.
“We believe that the critical mass of our transformational challenges is behind us, and we remain sharply focused on operational improvements and financial discipline to accelerate strategies to create sustainable, long-term growth for the Under Armour brand and our shareholders,” CEO Patrik Frisk said in a statement.
UA Price Action: Shares of Under Armour were trading 1.33% higher to $12.20 at last check Friday.
Shares traded higher to the $15 level earlier in the morning. The stock is down 36% year-to-date.
Benzinga file photo by Dustin Blitchok.
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