The controversy surrounding Under Armour (UA) speed-skating suits, which were blamed for impeding U.S. Olympic competitors in Sochi, did nothing to slow the company. In fact, the only mention of the flap in Thursday’s earnings report came from an analyst cracking a joke.
Under Armour’s non-Olympic performance last quarter was nothing short of admirable. Profit soared 73 percent to $13.5 million while sales surged 36 percent to $642 million. But the good news wasn’t enough for Wall Street, which was expecting a rosier outlook, and Under Armour shares plummeted 10 percent early this morning, its biggest drop in more than two years.
Here’s how the company hopes turn things around:
1. Superheroes: Under Armour has invested heavily in building up a line of footwear, an effort that culminated in the February launch of its Speedform Apollo running shoes. While Skechers tapped famed marathoner Meb Keflezighi to hawk its new high-performance sneakers, Under Armour turned to Hollywood. It cut deals to have its new kicks in featured in the Captain America sequel and even built a little superhero web store around the marketing ploy. The apparel company also has some “product integration” in the works for “The Flash,” slated for release in 2016.
2. Stephen Curry: Beating Nike in the market for tight-fitting t-shirts is one thing—schooling them in basketball, however, is much more difficult. In October, just before the NBA season started, Under Armour struck a five-year sponsorship deal with point guard Stephen Curry, who went on to have a break-out year. He may not be Jordan or Lebron, but Curry was an all-star who probably came a lot cheaper. Under Armour CEO Kevin Plank called the Curry deal a “game changer” for the brand.
3. One-handed zippers: Under Armour has apparently developed a technique to attach a magnet to the bottom of a zipper in such a way that the garment can be closed with one hand. It must feel pretty confident about the devices, which are already slated to be stitched into 400,000 pieces of outwear that will ship later this year. If these things actually work, a whole team of Nike engineers will be kicking themselves.
