HELSINKI – Amer Sports Inc. (NYSE: AS) reported first-quarter earnings that missed Wall Street’s expectations, sending its shares down 4.3%.
The company posted adjusted earnings per share (EPS) of $0.08, missing analyst consensus of $0.11. Despite the decline in profits, the company’s revenue rose 13% to $1.2 billion, helped by strong performance in its technical apparel segment.
The Helsinki-headquartered sports equipment company saw strong growth in its flagship Arc’teryx brand, driving strong growth in its technical apparel segment, which grew 44% year-on-year (YoY). This growth was particularly noticeable in the Asia-Pacific region and the Americas. Amer Sports also reported a significant increase in gross profit, driven by a strategic shift towards its most profitable brands and sales channels.
CEO James Zheng expressed confidence in the company’s brand-centric business model and its position in the premium sports and outdoor market. CFO Andrew Page highlighted the impact of the Arc’teryx brand on the company’s growth and profitability profile, emphasizing the ability to create shareholder value while investing in growth opportunities.
Despite the positive revenue trend, Amer Sports’ adjusted operating margin for the first quarter decreased to 11.0% from 13.4% in the prior year, primarily due to higher selling, general and administrative expenses. The company also used proceeds from its initial public offering to pay down $1.4 billion of debt, ending the quarter with net debt of $1.7 billion.
Looking ahead, Amer Sports provided full-year 2024 guidance, expecting revenue growth to average 10% and operating margins of 10.5% to 11.0%. The company expects to achieve higher than its previous adjusted full-year EPS guidance of $0.30 to $0.40, despite a negative impact of $0.03 to $0.04 from one-time financing costs incurred in the first quarter.
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