Under Armour has been hit hard by the coronavirus pandemic and reported a 23% decline in sales in the first quarter. To help counter the weak start to the year, the shoe and apparel maker plans to cut approximately $325 million in 2020 operating costs. Last month, Under Armour temporarily laid off 6,700 employees.
The quarter brought a net loss of $589.7 million on $930.2 million in revenue, down from a $22.5 million profit during the same period last year. The company’s 188 North American stores remain closed.
- Apparel: -23% ($598 million)
- Footwear: – 28% ($210 million)
- Accessories: – 17% ($68 million)
- North American revenue fell 28% to $609 million
- International sales dropped 12% to $287 million
Under Armour is also reportedly negotiating extended terms for its sports marketing deals, which include agreements with Steph Curry, Bryce Harper and several college teams. To make matters worse, the company expects second-quarter revenue to decline 50-60%.
MSG Dips Too
Madison Square Garden Sports Corp. also reported its quarterly numbers, including an 18% decrease in third-quarter revenues. The quarter included a spin-off of MSG’s entertainment businesses, but the financials of both entities were reported together.
MSG Sports generated $288.4 million, a decline of 18% from last year that was attributed largely to the suspension of the NBA and NHL seasons. The hiatuses hit ticket sales, local media rights fees from MSG Networks, suite license fees, and sponsorship and signage revenues.
- 2020 FY 3Q Revenue: $424 million
- Operating loss: $135.2 million
- Adjusted Operating Income: $11.6 million