What's Going On With Under Armour?
There's been a lot of news this week surrounding Under Armour, and it's not exactly positive. Yahoo Finance reported that the company let go of two marketing executives over spending concerns. This comes one month after the company told its employees they could no longer pay for strip-club visits on their corporate cards (which seems fair).
Employees were notified that Ryan Kuehl, senior vice president of global sports marketing, and Walker Jones, senior director of sports marketing, would be departing the company with no explanation. According to Yahoo Finance, both employees were close to CEO Kevin Plank, and they left following a review of marketing spending.
Under Armour has made no comment on the employees' departures.
Things got worse today, as the company's stock plummeted 10 percent following its annual investor day meeting. CNBC reported that investors are unsure if Under Armour can continue to grow sales, which have slowed down recently. Earlier this year, the company reported an $88 million fourth-quarter loss.
At this point, analysts are skeptical that Under Armour will ever turn it around. At the very least, it seems 2019 will be another rebuilding year for the company.
With all the negative press, we can't help but wonder what is going on with Under Armour? It seems like it'd be relatively easy to keep marketing spending on budget, but perhaps when you employ executives from your CEO's inner circle, it becomes more difficult to reign it in. Either way, the company has to take a serious look at itself if it hopes to remain a competitor in the athletic apparel space. Adidas, Nike and Lululemon continue to churn out successful apparel campaigns that attract both young and old consumers, and we can't say the same for Under Armour recently.
For now, the company is holding steady at retail, and it's still a popular request in the promotional apparel world. But it seems obvious that Under Armour is getting off track, and it might not be able to keep its head above water much longer. But fear not, promotional apparel distributors: Athletic and performance wear is still a safe bet for promotional apparel.