Under Armour (NYSE:UAA) on Thursday said quarterly sales fell 14% in North America, and adjusted its full-year profit guidance after settling a years-old securities lawsuit for $434 million.
Still, the company beat Wall Street’s expectations on the top and bottom lines.
In the three-months ended June 30, Under Armour reported a loss of $305.4 million, or 70 cents per share, compared with a profit of $10 million, or two cents per share, a year earlier. Excluding one-time expenses, it reported a profit of $4 million, or 1 cent per share.
Sales dropped to $1.18 billion, down about 10% from $1.32 billion a year earlier.
In late June, Under Armour agreed to settle a years-old securities lawsuit for $434 million about three weeks before a trial was slated to begin. In 2017, Under Armour was accused of defrauding shareholders about its revenue growth in a bid to meet Wall Street’s forecasts.
In a press release, the company said it was not admitting fault or wrongdoing but had agreed to end the case – about seven years after it was filed – because of “the costs and risks inherent in litigation.” Under Armour said it would pay the settlement using cash from its revolving credit facility.
The company now expects to swing to a loss in fiscal 2025. It’s forecasting losses per share to be between 53 cents and 56 cents and adjusted earnings per share to be between 19 cents and 22 cents.
UAA shares $1.13, or 17.5% to $7.60.
