In The Ideal, The Reality Of Breaking $7 Billion 500 Million Under Armour In 2018 Is Very Skinny.

US brands expect total revenue of around $5 billion in 2018, far from the planned 7 billion 500 million.

In addition to international

Except for the standard of income, the rest of the pcripts do not pass.

In 2015, Under Armour had a great reputation. Not only did it take Adidas's position in the North American market, but in July, when it gained a strong two quarter earnings report, it was a performance myth of 21 consecutive quarters of growth over 20%.

Only two months later, the US sports brand immediately launched a radical campaign.

The plan announced that global revenues and operating profits reached $7 billion 500 million and $800 million before fiscal 2018, respectively.

The annual report shows that the above two data in the 2014 fiscal year were $3 billion 80 million and $354 million.

This means that sales of Under Armour should be doubled over the past 4 years, achieving at least 25% of the annual compound growth rate. This is a challenging goal, showing the ambition of the new brand.

The capital market and investors are obviously impressed by the past events. On the day of the radical plan announcement, the company's share price rose to a record high of $103.56.

However, the ideal is very plentiful, but the reality is bone.

In April 20, 2018, Under Armour's share price plummeted to $16.10.

Over the past two years, the key business growth of the brand has continued to slow down. In the three quarter of fiscal year 2017, there has been a loss, facing a severe sales crisis. The management of the company has had a very serious deviation from its strategic expectations for the 2018 fiscal year.

Now it seems almost impossible for American brands to complete the plan in 2018.

If we compare the target figures set in 2015 with the 2018 performance expectations, we can see clearly what areas of Under Armour problems are emerging.

International income is the only pass in the pcript.

In fiscal year 2017, Under Armour's annual revenue was $4 billion 980 million.

US brands released 2018 fiscal year expectations show that revenue is expected to be flat or at a low single digit growth.

Among them, sales in North America are expected to drop by a median figure, and the international market is expected to grow by more than 25%.

According to this calculation, the brand expects total revenue of about $5 billion in 2018, which is far from the planned US $7 billion 500 million.

From the chart, there is a big gap between the indicators set by Under Armour in terms of clothing, footwear, North America, wholesale or DTC direct business income.

Among them, the biggest mistake is in the North American market, and only about $3 billion 600 million can be achieved in the revenue strategy of up to US $6 billion.

In the 2017 fiscal year, the core market accounted for nearly 80% of the total revenue.

Secondly,

And wholesale business, both of which are 1 billion 500 million dollars less than target, and the difference between footwear and DTC business income is $700 million respectively.

In 2017, sales of wholesale customers such as sporting goods retailers fell by 1%.

Prior to that, Under Armour had stepped up its cooperation with some of the lower and middle end distributors in order to promote sales. This practice is considered to be damaging to the brand image and the revenue is not satisfactory.

According to the radical plan, clothing and

The product is expected to contribute $6 billion 600 million to the target of US $7 billion 500 million in 2018, but from the current situation, we can only support about $4 billion 400 million this year.

For a long time, the product of Under Armour has been evaluated as "not cool" by the market, lacking of innovative design and clear characteristics.

At the same time, in the past year's pursuit of growth, American brands have launched a large number of new products, but failed to attract consumers to pay, or even puzzled the consumer market. What kind of products do Under Armour want to sell?

Because of this, the US brand that accumulated a lot of stock in 2017 had to sell it in a discounted way, and Maori was damaged.

As a result, the product sales cycle of the company is too long, so it is difficult to flexibly adjust the design and development of clothing and shoes category according to the market reaction, resulting in the declining sales of these product lines.

As the only "pass" data in the pcript, Under Armour's international business income in 2018 is expected to reach US $1 billion 400 million, unchanged from the target figure.

Over the past three years, overseas revenue grew by 69%, 63% and 46%, respectively, reaching 1 billion 100 million US dollars in the 2017 fiscal year.

Despite strong international sales, the region's revenue accounts for only 23% of the total.

This business will undoubtedly become the core part of the company's new strategic plan. Under Armour has made it clear that it will continue to increase its potential in overseas markets.

Faced with this embarrassing pcript, chief operating officer Patrick Frisk (Patrik Frisk) said at the fourth quarter fiscal year 2017 earnings call conference that the current company's focus is on targeted solutions to simplify the product supply type, focusing on male training, female training and running areas, which the brand calls "

The largest and most stable category of opportunity.

In addition, Under Armour says it will expand DTC services directly to consumers.

In particular, in China, Europe, the Middle East and Africa, the company will continue to accelerate its direct business development.

"The situation in 2017 has prompted us to make strategic pformation, and the company will turn into an excellent company." Kevin Plank still has enough confidence in the immediate predicament.

In April 18th, Wedbush, a US brokerage firm, released a research report, which released the latest list of the global sporting goods market based on the earnings performance data of major sports brands worldwide.

The most important change in the list is that the original Under Armour, which was third place, was surpassed by PUMA. Last year, the sales volume of German sporting goods reached 4 billion 30 million euros (4 billion 990 million US dollars), while Under Armour was 4 billion 980 million dollars, which fell to fourth place just now.

Meanwhile, the crisis of the continued decline of us upstart brands remains.

The New Balance after Under Armour, which earned about $3 billion 800 million in 2016, has risen to $4 billion 500 million in 2017. As a sports brand ranked fifth in the market share, New Balance has been catching up with the former.