11:49 AM EST, 11/07/2024 (MT Newswires) -- Under Armour ( UAA ) raised its outlook for fiscal 2025 adjusted earnings after it "outperformed" in the just-ended quarter, although sales will continue to face pressure in North America and in the direct-to-consumer segment, where the sportswear company is looking to curb promotions.

Adjusted earnings are projected between $0.24 and $0.27 a share for the fiscal year, up from the prior view for $0.19 to $0.21. The consensus on Capital IQ is for $0.23. The gross margin is now expected to rise by 125 basis points to 150 basis points, better than the previous guidance of 75 to 100 basis points.

In the current fiscal third quarter, Under Armour ( UAA ) sees adjusted EPS of $0.02 to $0.04, straddling the Street's view for $0.03. In the fiscal second quarter ended Sept. 30, adjusted earnings came in at $0.30 a share. No comparable result was reported for the prior year. On a GAAP basis, income increased to $0.39 from $0.23, versus the Street's view for $0.18.

"We outperformed the profitability outlook we provided in August," Chief Financial Officer Dave Bergman told analysts on a conference call, according to a Capital IQ transcript. "However, in line with our expectations, revenue was down 11% to $1.4 billion, with a 13% decline in North America due to softer full-price wholesale demand and lower sales to the off-price channel."

The consensus for second-quarter revenue was $1.38 billion.

Under Armour's ( UAA ) class A shares surged 32% intraday Thursday. The sneaker maker announced a restructuring plan in May.

"Our work to reconstitute the Under Armour brand continues to gain traction," Bergman told analysts. "Though we still have much work to do, we're encouraged by our early progress in this journey."

Direct-to-consumer revenue fell 8% to $550.3 million, with e-commerce down 21% "due to planned decreases in promotional activities," the company said. Apparel revenue fell 12% to $947.2 million and footwear dropped 11% to $312.8 million.

Revenue in fiscal 2025 is still expected to post a low double-digit percentage decline, including a 14% to 16% drop in North America. Revenue in the current quarter is seen falling 10%, "which assumes continued pressure in North America and ongoing proactive strategies to reduce promotional activities in our DTC businesses," Bergman said on the call.

Price: 11.54, Change: +2.79, Percent Change: +31.89