Revenue Growth - Total net revenues increased by 7.9%, with wholesale revenue up 9.7% and direct-to-consumer revenue up 11.7%[172] - Apparel revenue increased by 14.2%, footwear revenue increased by 10.4%, while accessories revenue decreased by 12.9%[172] - Revenue growth in North America, EMEA, Asia-Pacific, and Latin America segments was 7.6%, 14.8%, 18.5%, and 27.2%, respectively[172] - Net revenues increased by $112.5 million, or 7.9%, to $1,545.5 million for the three months ended September 30, 2021, compared to $1,433.0 million in the same period of 2020[190] - Net sales increased by $143.5 million, or 10.5%, to $1,514.3 million for the three months ended September 30, 2021, driven by growth in apparel and footwear[193] - License revenues rose by $6.0 million, or 23.8%, to $31.1 million for the three months ended September 30, 2021, reflecting improved conditions for licensees[195] - The increase in net sales for the nine months ended September 30, 2021, was $1,165.6 million, or 40.0%, totaling $4,079.1 million compared to $2,913.6 million in the same period of 2020[194] - Total net revenues for the nine months ended September 30, 2021, increased by $1,083.4 million, or 35.3%, to $4,154.3 million compared to $3,070.9 million during the same period in Fiscal 2020[227] Profitability - Gross margin improved by 310 basis points to 51.0%[180] - Gross profit increased by $101.8 million to $788.1 million for the three months ended September 30, 2021, with a gross margin of 51.0%, up from 47.9% in the same period of 2020[201] - Income from operations increased by $113.5 million to $172.1 million for the three months ended September 30, 2021, compared to $58.6 million in the same period of 2020[190] - Net income increased by $74.5 million to $113.4 million for the three months ended September 30, 2021, compared to $38.9 million in the same period of 2020[190] - Total operating income for the nine months ended September 30, 2021, was $400.2 million, a significant increase of $1,069.4 million compared to a loss of $669.3 million in the same period of Fiscal 2020[233] Expenses - Selling, general and administrative expenses rose by 8.3%[180] - Selling, general and administrative expenses increased by $45.8 million, or 8.3%, to $599.4 million for the three months ended September 30, 2021, representing 38.8% of net revenues[205] - Selling, general and administrative expenses increased by $72.9 million, or 4.6%, to $1,659.0 million for the nine months ended September 30, 2021, compared to $1,586.2 million during the same period in Fiscal 2020[206] Restructuring and Charges - Restructuring and impairment charges decreased by 77.6% from $74.2 million in Q3 2020 to $16.7 million in Q3 2021[180] - The company expects total restructuring and related charges from the 2020 restructuring plan to range between $525 million to $575 million[183] - Cash restructuring charges amounted to $199.0 million, with $28.0 million related to employee severance and benefits[186] Cash Flow and Liquidity - Cash and cash equivalents as of September 30, 2021, totaled $1.3 billion, providing adequate liquidity for the next twelve months[236] - Cash flows provided by operating activities increased by $459.6 million compared to the same period in Fiscal 2020, primarily driven by an increase in net income[241] - Cash flows used in financing activities decreased by $853.8 million, with approximately $417.5 million used for financing activities in the nine months ended September 30, 2021[243] Debt and Financing - The company entered into an amended credit agreement with a term of five years, maturing in March 2024, with a reduction in revolving credit commitments from $1.25 billion to $1.1 billion[244] - The company issued $500.0 million in 1.50% convertible senior notes due 2024, with net proceeds of $488.8 million used primarily to repay indebtedness under the revolving credit facility[254][256] - The company issued $600.0 million in 3.250% senior unsecured notes due June 15, 2026, with proceeds used to pay down amounts under the revolving credit facility[269] - The amended credit agreement requires the company to maintain a consolidated EBITDA to consolidated interest expense ratio of not less than 3.50 to 1.0[250] - As of September 30, 2021, the company was in compliance with all applicable covenants under the amended credit agreement[250] Market Conditions - The COVID-19 pandemic has caused disruptions, including increased freight costs and manufacturing challenges, particularly in Southeast Asia[175] - The company recognized incentives totaling $0.6 million and $2.7 million for Q3 2021, compared to $1.5 million and $6.6 million for Q3 2020[178] Accounting and Compliance - The consolidated financial statements are prepared in accordance with U.S. GAAP, with estimates affecting reported amounts of assets, liabilities, revenues, and expenses[273] - There were no significant changes to critical accounting policies during the nine months ended September 30, 2021[274] - Market risk exposure has not changed significantly since December 31, 2020[277]
Under Armour(UAA) - 2022 Q2 - Quarterly Report