American sports equipment and fitness apparel company Under Armour has suffered a steep drop in share value following a 14% drop in revenue, alongside higher transportation costs and manufacturing slowdown due to COVID-19 spikes in China.
Alongside manufacturing issues, COVID-19 spikes and restrictions in China resulted in a 14% drop in revenue in the Asia-Pacific region in Q1 of the year. Other companies, such as Adidas also reported sales drops as a result.
Under Armour shares dropped 21% in premarket trading, as the company forecast full-year profits below what was estimated. The company reported $84.7 million AUD ($59.6 million USD) in losses for the period that ended March 31st, compared profits with $110.5 million AUD ($77.7 million USD) the year before.
Telsey Advisory Group said “Overall, the 1Q22 miss and lower FY23 (profit forecast) are disappointing and put into question the progress the company made last year on improving the brand and profitability,” regarding the company’s issues.
