2017 was a tough year for sportswear companies
2017 was a challenging year for US sportswear companies. Stiff competition, particularly in the North American market, and higher mark-downs hit comps and margins for most companies.
Nike, for instance, posted a 4.5% YoY decline in North American sales with its recent quarterly results. The company’s gross margin contracted, and its net income plunged 9%.
Under Armour (UAA) performed even worse. The company reported a 4.5% decline in total revenues while its gross margin contracted for the tenth consecutive quarter recently. Skechers (SKX) has, however, been an exception. The company’s total sales have increased more than 12% over the last 12 months as the company expects to stay strong over the near term.
What hit US sportswear companies in 2017?
We saw a resurgence of German rivals Adidas (ADDYY) and Puma in the United States during 2017 as customers increasingly preferred retro styles instead of performance-based shoes. This trend particularly hit Nike (NKE) and Under Armour (UAA), which failed to cash in on the retro trend. Read the next part of this series to learn more.
What’s in this series?
In this series, we’ll briefly discuss the performance of some of the major US sportswear companies in 2017. We’ll look at their recent financial performance, their stock market performance, and Wall Street’s take. Our discussion will focus on Nike, Under Armour, Lululemon Athletica (LULU), and Skechers (SKX).