Under Armour, Inc. (NYSE: UA) shares surged on Thursday after the company posted first-quarter loss smaller than expected, regaining investors’ confidence in the athletic brand after a sluggish year.
The company said first-quarter loss was $2.3 million, or 1 cent per share, compared with a profit of $19.2 million, or 4 cents per share, a year earlier. Analysts polled by Thomson Reuters had predicted a loss of 4 cents in the first quarter.
Revenue rose 6.6 percent to $1.12 billion from $1.05 billion a year earlier, beating analysts’ estimate of $1.11 billion.
"Our first quarter results were in line with our expectations and we're off to a solid start in 2017," CEO Kevin Plank said in a statement. "By proactively managing our growth to deliver superior innovative product, continuing to strengthen our connection with consumers and increasing our focus on operational excellence – we have great confidence in our ability to drive toward our full year targets."
Under Armour has been struggling to maintain its fast growth in the past year. The stock plunged more than 20 percent when it lowered its annual forecast in January. The company also faces intense competition from Nike and Adidas.
The company said accessories sales rose 12 percent in the first quarter, while apparel revenue increase 7 percent. However, footwear revenue only rose 2 percent, compared with a 64 percent gain a year earlier. Sales of the company's Curry 3 were softer-than-expected, CEO Kevin Plank said on an earnings call with analysts.
Under Armour's Class A shares rose as much as 9 percent to $21.51 in the early trading.