Although Under Armour posted its first-ever loss Thursday, it was not nearly as bad as some had feared, sending shares up more than 10 percent at one point.
Shares of the company closed up more than 9 percent on Thursday.
Here's what the company reported vs. what the Street was expecting:
- EPS: A loss of 1 cent vs. estimated loss of 4 cents, according to Thomson Reuters.
- Revenue: $1.12 billion vs. $1.11 billion, analysts said.
Under Armour said it swung to a net loss of $2.3 million, or a penny per share, for the first quarter, from a profit of $19.2 million, or 4 cents per share, a year earlier.
It said sales climbed nearly 7 percent to $1.12 billion from $1.05 billion a year earlier, boosted by increases in wholesale and direct-to-consumer revenues.
Under Armour's North American revenue, though, fell 1 percent "as new distribution was more than offset by the absence of business lost to bankruptcies in 2017," the company said.
The retailer reported a 12 percent increase in accessories sales for the first quarter, fueled by strength in men's training, running, youth and global football business segments. Apparel revenue climbed 7 percent from gains in training, golf and team sports, while footwear revenue grew a mere 2 percent.
During the year-earlier period, footwear sales were up a whopping 64 percent due to "significant strength in basketball sales," the company said.
"UAA is one of the few brands that matter in the athletic space," Jefferies research firm wrote in a Thursday note to clients following the earnings report. Analyst Randal Konik said the company has a significant opportunity to scale its North American segments further, specifically in women's wear and footwear.
"We believe this brand is here to stay," Konik added, as profit margins came in "better than feared" for the quarter, and Under Armour's inventories remain "in good shape."
Just last quarter Under Armour lowered its guidance for 2017, pegging estimates for operating income down to $320 million and said it now anticipates a smaller gross margin for the full year. It said it continues to back those expectations.
Under Armour also continues to anticipate net revenue to grow 11 to 12 percent to reach nearly $5.4 billion by the end of this year.