Under Armour, Inc. (UA) Bundle
A Brief History of Under Armour, Inc.
Under Armour, Inc., founded in 1996 by Kevin Plank, began its journey as a manufacturer of moisture-wicking shirts aimed at athletes. The company has since evolved into a global leader in performance apparel, footwear, and accessories.
Company Growth and Development
Under Armour went public in 2005, raising $153 million in its initial public offering (IPO) and trading on the New York Stock Exchange under the ticker symbol UA. The IPO was a significant milestone, marking its entry into the public markets as a high-growth company.
By 2014, Under Armour reported revenues exceeding $3 billion, driven by innovative marketing campaigns and endorsements from high-profile athletes. The company's expansion included the acquisition of fitness apps like MyFitnessPal and Endomondo in 2015, enhancing its digital health and fitness portfolio.
Financial Performance Overview
As of the second quarter of 2024, Under Armour reported net revenues of $1.57 billion for the three months ended September 30, 2023, reflecting a slight decrease from $1.57 billion in the same period of 2022. For the six months ended September 30, 2023, net revenues totaled $2.88 billion, down from $2.92 billion year-over-year.
| Financial Metrics | Q2 2024 (3 months) | Q2 2023 (3 months) | Q2 2024 (6 months) | Q2 2023 (6 months) |
|---|---|---|---|---|
| Net Revenues | $1,566,710 | $1,573,885 | $2,883,722 | $2,922,942 |
| Cost of Goods Sold | $814,715 | $860,051 | $1,523,991 | $1,578,911 |
| Gross Profit | $751,995 | $713,834 | $1,359,731 | $1,344,031 |
| Net Income | $109,614 | $86,925 | $118,163 | $94,607 |
Stock Performance and Market Position
Under Armour's stock has experienced fluctuations since its IPO, impacted by market conditions and internal challenges. As of September 30, 2023, the company's market capitalization was approximately $3.30 billion. The company's Class C shares have seen a notable decline from highs above $20 in 2016 to around $6.74 per share.
Recent Developments and Strategic Initiatives
In 2022, Under Armour announced a $500 million share repurchase program, aimed at enhancing shareholder value and demonstrating confidence in its long-term prospects. As of September 30, 2023, approximately $475 million of shares had been repurchased.
The company continues to focus on expanding its direct-to-consumer sales channels and enhancing its e-commerce capabilities, aligning itself with shifting consumer preferences toward online shopping. Under Armour's strategic initiatives also emphasize sustainability and innovation within its product lines.
Challenges and Resilience
Despite facing challenges such as increased competition and supply chain disruptions, Under Armour has adapted by refining its marketing strategies and focusing on core products that resonate with its target demographic. The company's commitment to performance and quality remains at the forefront of its operational strategy.
Outlook for Future Growth
Looking forward, Under Armour aims to leverage its brand strength and innovative capabilities to capture new market opportunities. The company's ongoing investments in technology and athlete partnerships are expected to drive growth in the coming years.
A Who Owns Under Armour, Inc. (UA)
Overview of Ownership Structure
As of 2024, Under Armour, Inc. has a diverse ownership structure consisting of three classes of common stock: Class A, Class B, and Class C. The total number of shares outstanding as of September 30, 2023, is as follows:
| Class of Stock | Shares Outstanding | Par Value |
|---|---|---|
| Class A Common Stock | 188,725,000 | $0.0003 |
| Class B Convertible Common Stock | 34,450,000 | $0.0003 |
| Class C Common Stock | 214,688,628 | $0.0003 |
Major Shareholders
As of September 30, 2023, the following table outlines the major shareholders of Under Armour, Inc., reflecting the percentage of total shares held:
| Shareholder | Class of Stock | Shares Held | Percentage of Total Shares |
|---|---|---|---|
| Kevin Plank (CEO) | Class B | 34,450,000 | 15.5% |
| Institutional Investors | Class A & C | ~80,000,000 | ~35.2% |
| Mutual Funds | Class A & C | ~40,000,000 | ~17.6% |
| Other Individual Investors | Class A & C | ~75,000,000 | ~32.0% |
Class Structure and Voting Rights
Under Armour's stock structure includes:
- Class A shares, which have one vote per share.
- Class B shares, which are convertible into Class A shares and have ten votes per share, primarily held by Kevin Plank.
- Class C shares, which have no voting rights.
Recent Stock Performance
The stock price of Under Armour, Inc. as of September 30, 2023, was approximately $8.30 per share. The market capitalization of the company is estimated to be around $2.1 billion based on the total number of shares outstanding.
Financial Overview
For the six months ended September 30, 2023, Under Armour reported a net income of $118.16 million, with total revenues of $2.88 billion. The company’s total assets were reported at $4.75 billion, and total stockholders' equity stood at $2.09 billion as of the same date.
| Financial Metric | Value |
|---|---|
| Net Income (6 months) | $118.16 million |
| Total Revenues (6 months) | $2.88 billion |
| Total Assets | $4.75 billion |
| Total Stockholders' Equity | $2.09 billion |
Under Armour, Inc. (UA) Mission Statement
Company Overview
Under Armour, Inc. is a leading developer, marketer, and distributor of branded performance apparel, footwear, and accessories. The brand is recognized for its innovative moisture-wicking fabrications designed for athletes and consumers with active lifestyles.
Mission Statement
Under Armour's mission is to "make all athletes better through passion, design, and the relentless pursuit of innovation." This mission underscores the company's commitment to enhancing performance through cutting-edge technology and high-quality products.
Core Values
- Performance: Focused on improving athletic performance.
- Innovation: Continuous pursuit of new technologies and designs.
- Community: Commitment to building a community of athletes.
- Sustainability: Efforts to reduce environmental impact.
Financial Performance
For the three months ended September 30, 2023, Under Armour reported the following financial results:
| Financial Metric | Q2 2024 | Q2 2023 | Change (%) |
|---|---|---|---|
| Net Revenues | $1,566,710,000 | $1,573,885,000 | -0.5% |
| Gross Profit | $751,995,000 | $713,834,000 | 5.3% |
| Operating Income | $145,759,000 | $119,410,000 | 22.0% |
| Net Income | $109,614,000 | $86,925,000 | 25.9% |
| Diluted EPS | $0.24 | $0.19 | 26.3% |
Market Position
Under Armour continues to focus on expanding its market share, particularly in the direct-to-consumer segment, which saw a revenue increase of 3.2% in Q2 2024 compared to the prior year. This strategy is part of the company's broader goal to enhance brand engagement and customer loyalty.
Regional Performance
Regional financial performance for the three months ended September 30, 2023, is as follows:
| Region | Net Revenue Change (%) |
|---|---|
| North America | -2.0% |
| Europe, Middle East, and Africa (EMEA) | +9.3% |
| Asia-Pacific | +2.8% |
| Latin America | -7.7% |
Future Outlook
Looking ahead, Under Armour aims to enhance its product offerings and expand its footprint in both domestic and international markets. The focus on sustainability and community engagement will be key drivers of its strategic initiatives.
Liquidity and Capital Resources
As of September 30, 2023, Under Armour reported approximately $655.9 million in cash and cash equivalents, indicating strong liquidity to support ongoing operations and capital investments.
Stockholder Equity
| Equity Component | Value (as of September 30, 2023) |
|---|---|
| Class A Common Stock | $63,000 |
| Class B Convertible Common Stock | $11,000 |
| Class C Common Stock | $71,000 |
| Additional Paid-in Capital | $1,162,548,000 |
| Retained Earnings | $994,110,000 |
| Accumulated Other Comprehensive Income (Loss) | ($67,061,000) |
| Total Stockholders' Equity | $2,089,742,000 |
Conclusion
Under Armour's mission and financial performance reflect its commitment to innovation and market leadership in the performance apparel industry.
How Under Armour, Inc. (UA) Works
Financial Overview
As of September 30, 2023, Under Armour, Inc. reported net revenues of $1,566,710 thousand for the three months ended, a slight decrease of 0.5% compared to $1,573,885 thousand in the same period in 2022. For the six months ended September 30, 2023, total net revenues were $2,883,722 thousand, down 1.3% from $2,922,942 thousand in the prior year.
Revenue Breakdown
| Product Category | Q2 2023 Revenue (in thousands) | Q2 2022 Revenue (in thousands) | Change ($) | Change (%) |
|---|---|---|---|---|
| Apparel | $1,070,437 | $1,038,268 | $32,169 | 3.1% |
| Footwear | $351,202 | $375,885 | ($24,683) | (6.6%) |
| Accessories | $113,933 | $111,117 | $2,816 | 2.5% |
| Total Net Revenues | $1,566,710 | $1,573,885 | ($7,175) | (0.5%) |
Operating Income
Under Armour achieved an operating income of $145,759 thousand for the three months ended September 30, 2023, reflecting a 22.1% increase from $119,410 thousand in 2022. The operating income for the six months was $166,689 thousand, a rise of 8.3% from $153,893 thousand in the same period last year.
Geographical Revenue Distribution
| Region | Q2 2023 Revenue (in thousands) | Q2 2022 Revenue (in thousands) | Change ($) | Change (%) |
|---|---|---|---|---|
| North America | $991,393 | $1,011,823 | ($20,430) | (2.0%) |
| EMEA | $287,091 | $262,679 | $24,412 | 9.3% |
| Asia-Pacific | $232,065 | $225,729 | $6,336 | 2.8% |
| Latin America | $53,669 | $58,162 | ($4,493) | (7.7%) |
Cost and Profit Analysis
The cost of goods sold for the three months ended September 30, 2023, was $814,715 thousand, resulting in a gross profit of $751,995 thousand, yielding a gross margin of 48.0%, an increase from 45.4% in the prior year. Selling, general and administrative expenses reached $606,236 thousand.
Net Income
Under Armour's net income for the three months ended September 30, 2023, was $109,614 thousand, compared to $86,925 thousand in 2022, marking an increase of 25.9%. The diluted net income per share was $0.24 for the same period.
Cash Flow and Capital Expenditures
For the six months ended September 30, 2023, cash flows from operating activities amounted to $64,243 thousand. Capital expenditures totaled $84,144 thousand, or approximately 3% of net revenues, reflecting a decrease from $93,864 thousand in the prior year.
Balance Sheet Highlights
| Item | As of September 30, 2023 (in thousands) | As of March 31, 2023 (in thousands) |
|---|---|---|
| Cash and Cash Equivalents | $655,866 | $711,910 |
| Accounts Receivable | $805,197 | $759,860 |
| Inventories | $1,143,872 | $1,190,253 |
| Total Assets | $4,746,553 | $4,857,083 |
| Total Liabilities | $2,285,830 | $2,433,682 |
How Under Armour, Inc. (UA) Makes Money
Revenue Streams
Under Armour generates revenue through various channels, primarily through net sales of apparel, footwear, and accessories, along with license revenues and other digital business opportunities.
| Revenue Source | Q2 2024 Revenue (in thousands) | Q2 2023 Revenue (in thousands) | Change ($) | Change (%) |
|---|---|---|---|---|
| Net Sales | $1,535,572 | $1,525,270 | $10,302 | 0.7% |
| License Revenues | $28,646 | $33,123 | ($4,477) | (13.5%) |
| Corporate Other | $2,492 | $15,492 | ($13,000) | (83.9%) |
| Total Net Revenues | $1,566,710 | $1,573,885 | ($7,175) | (0.5%) |
Net Sales by Product Category
Net sales are categorized into apparel, footwear, and accessories, each contributing differently to the overall revenue.
| Product Category | Q2 2024 Revenue (in thousands) | Q2 2023 Revenue (in thousands) | Change ($) | Change (%) |
|---|---|---|---|---|
| Apparel | $1,070,437 | $1,038,268 | $32,169 | 3.1% |
| Footwear | $351,202 | $375,885 | ($24,683) | (6.6%) |
| Accessories | $113,933 | $111,117 | $2,816 | 2.5% |
Distribution Channels
The company sells its products through various distribution channels, including wholesale and direct-to-consumer sales.
| Distribution Channel | Q2 2024 Revenue (in thousands) | Q2 2023 Revenue (in thousands) | Change ($) | Change (%) |
|---|---|---|---|---|
| Wholesale | $939,725 | $948,154 | ($8,429) | (0.9%) |
| Direct-to-Consumer | $595,847 | $577,116 | $18,731 | 3.2% |
Geographic Revenue Breakdown
Net revenues are also segmented by geography, showing varied performance across regions.
| Region | Q2 2024 Revenue (in thousands) | Q2 2023 Revenue (in thousands) | Change ($) | Change (%) |
|---|---|---|---|---|
| North America | $991,393 | $1,011,823 | ($20,430) | (2.0%) |
| EMEA | $287,091 | $262,679 | $24,412 | 9.3% |
| Asia-Pacific | $232,065 | $225,729 | $6,336 | 2.8% |
| Latin America | $53,669 | $58,162 | ($4,493) | (7.7%) |
Cost Structure and Profitability
Understanding the cost structure is essential for assessing profitability. The cost of goods sold (COGS) and gross profit margins are crucial metrics.
| Metric | Q2 2024 Amount (in thousands) | Q2 2023 Amount (in thousands) | Change ($) | Change (%) |
|---|---|---|---|---|
| Cost of Goods Sold | $814,715 | $860,051 | ($45,336) | (5.3%) |
| Gross Profit | $751,995 | $713,834 | $38,161 | 5.3% |
| Gross Margin (%) | 48.0% | 45.4% | 2.6% | 5.7% |
Operating Income
The operating income reflects the profitability from the core business operations, excluding non-operating income and expenses.
| Region | Q2 2024 Operating Income (in thousands) | Q2 2023 Operating Income (in thousands) | Change ($) | Change (%) |
|---|---|---|---|---|
| North America | $215,457 | $209,206 | $6,251 | 3.0% |
| EMEA | $40,697 | $35,895 | $4,802 | 13.4% |
| Asia-Pacific | $54,608 | $46,134 | $8,474 | 18.4% |
| Latin America | $13,644 | $7,177 | $6,467 | 90.1% |
| Corporate Other | ($178,647) | ($179,002) | $355 | 0.2% |
| Total Operating Income | $145,759 | $119,410 | $26,349 | 22.1% |
Net Income
The net income indicates the overall profitability after all expenses, including taxes and interest.
| Metric | Q2 2024 Amount (in thousands) | Q2 2023 Amount (in thousands) | Change ($) | Change (%) |
|---|---|---|---|---|
| Net Income | $109,614 | $86,925 | $22,689 | 26.1% |
| Basic EPS | $0.25 | $0.19 | $0.06 | 31.6% |
| Diluted EPS | $0.24 | $0.19 | $0.05 | 26.3% |
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