Under Armour profit drops, revenue forecast disappoints

Under Armour Inc reported a 13.4 percent fall in first-quarter profit as costs rose following a pair of acquisitions and the sports apparel maker issued an updated full-year revenue forecast that fell short of market expectations.

The company's shares fell 4.7 percent to $83.85 in premarket trading on Tuesday.

Under Armour bought fitness tracking services Endomondo and MapMyFitness in February for about $560 million, moving further into the "connected fitness" market.

The company wants to boost sales by integrating fitness tracking services with its sportswear and use insights about consumers' health and fitness to sell more clothing and shoes.

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Baltimore-based Under Armour raised its 2015 revenue forecast to $3.78 billion, which would be an increase of about 23 percent from 2014.
Analysts on average had expected $3.82 billion, according to Thomson Reuters I/B/E/S.

In February, Under Armour said it expected full-year revenue of $3.76 billion.
The company, which recently dislodged Adidas AG as the No. 2 sports footwear and clothing brand by sales in the United States behind Nike Inc, said apparel revenue rose about 21 percent to $555 million in the quarter.

Footwear revenue rose 41 percent to $161 million, helped by strong demand for its Speed Form running shoes and Curry One basketball shoes.

The company's net income fell to $11.7 million, or 5 cents per share, from $13.5 million, or 6 cents per share, a year earlier.

Revenue rose about 25.5 percent to $804.9 million.

Analysts on average had expected a profit of 4 cents per share on revenue of $802.5 million.

Cost of goods sold rose 25.3 percent to $427.3 million, while selling, general and administrative expenses rose 27.8 percent to about $350 million.

Up to Monday's close, the company's shares had risen 65.4 percent in the past 12 months.

$1 = £0.67