Under Armour orders drop due to supply chain woes

Reuters Videos
2 年前

Under Armour on Friday joined the chorus of companies lamenting supply chain issues, warning that higher transportation costs would squeeze its earnings in the current quarter.

Shares were down roughly 10 percent in midday trading after the athletic-wear company flagged reductions to its spring and summer orders.

Product availability has been a concern for Under Armour and its rivals Lululemon Athletica and Nike, as Asian factories that make their clothing are only just recovering from COVID-19 outbreaks and employee shortages.

On an earnings call Friday, Under Armour’s Chief Financial Officer said the company expects supply issues to continue well into fiscal 2023.

The company has been forced to use pricier air freight due to port congestion as it strives to stock its shelves, with demand for athletic wear still strong.

Like many companies, it’s raised prices of its products to cover higher costs across supply chains, from labor to raw material.

The silver lining was that those higher prices, along with robust demand, did help Under Armour post better-than-expected results for its critical holiday quarter.