How Under Armour has delivered 25 straight quarters of 20% revenue growth

Under Armour’s Q2 earnings report on Tuesday morning met analyst expectations on earnings (4 cents per share) and on revenue ($1 billion, up 28%). But to say the company merely ‘met’ expectations is to overlook an impressive milestone: Under Armour has now had 25 consecutive quarters with 20% or higher revenue growth.

So, how do Under Armour sales continue to grow so steadily?

To be sure, there are many headwinds facing the company, including: The demise of brick-and-mortar chains like Sports Authority, on which Under Armour has long relied; predictions that the current ‘athleisure’ trend may be coming to an end; and Under Armour losing ground to some of its rivals recently, especially in women’s apparel.

But there’s a lot Under Armour is doing right.

Under Armour entering Kohl’s

On its earnings call, the company at last announced a long-rumored deal to sell Under Armour in Kohl’s retail stores. Beginning March 1, Kohl’s will roll out UA apparel and footwear in 600 stores at first, and eventually in all 1,100 of its stores. It will also sell its HealthBox fitness tracker at Kohl’s, where it could sell well.

CEO Kevin Plank said in response to an analyst’s question that the Kohl’s deal is “not reactionary.” That is: It had been in the works for a while and isn’t a hasty step to react to the liquidation of Sports Authority and others. But he need not belabor this point; the deal likely is a reaction to the struggles of sports retail chains, and it’s a smart reaction. If the more obvious sporty chains where UA typically sold are in trouble, UA needs to head to a different kind of chain to reach brick-and-mortar shoppers. Morgan Stanley analyst Jay Sole has predicted the Kohl’s deal can bring Under Armour $190 million in new revenue.

Under Armour will also move into the vacated FAO Schwarz store on Manhattan’s Fifth Avenue, it said.

Under Armour signing the right athletes and schools

In addition to its insanely strong stable of individual athletes, including Tom Brady, Jordan Spieth, Michael Phelps (about to attract the eyes of the world at the Rio Olympics), Stephen Curry (more on him in a moment) and Misty Copeland, Under Armour signed a landmark deal with UCLA this year.

It was the biggest-ever sports sponsorship deal with a school in history, though as these deals inflate that title won’t last long. UCLA has won more national team championships than any other school, and the signing shows that Under Armour can really challenge Nike for such coveted contracts, even though Nike still has the lion’s share of exclusive collegiate apparel deals.

Under Armour still loooooves Stephen Curry

On last quarter’s earnings call, Kevin Plank uttered Stephen Curry’s name in praise more than 10 times. This time around, Plank and UA are still feeling the Curry love. Footwear revenue rose 58% in Q2 to $243 million, thanks to, “the continued success of the basketball category led by the Curry signature basketball line,” the company said.

That suggests the widespread ridicule of the two most recent Curry sneakers hasn’t much mattered to the financial success of the line.

Footwear revenue is now the second-biggest category for UA, behind apparel. There was a time when the big knock against the company was its footwear; that’s no longer a fair narrative.

Under Armour thriving in England

UA revenues more than doubled in the UK in Q2. There, the company has signed a slew of apparel deals with football clubs (“soccer,” in American parlance) like Aston Villa, Tottenham Hotspurs, and Granit Xhaka, a Swiss national team star who plays in the German Bundesliga. (“Another high-profile player in our boots when the season starts,” Plank said of Xhaka.)

Going after soccer is a move to chase down Adidas, which has long been seen as the global leader in that sport.

Under Armour is ramping up in China

China is becoming the next frontier in sports apparel, and Under Armour has made steady, incremental leaps there. It didn’t start selling product there until 2010, and has gone from doing $3 million in revenue there in 2012, to $7 million in 2013, up to $80 million last year, and this year it will do “north of $150 million” there. This is still a tiny part of Under Armour’s business, but it has grown quickly, a positive sign that the brand can resonate outside the US.

“We’re seeing an inflection point for the brand in China,” Plank said. The company will open 100 new stores in China this year.

Under Armour is working on its women’s apparel

A report from Morgan Stanley in January said that Under Armour’s share in the women’s market has fallen precipitously. Bloomberg ran a headline saying that the company “has a woman problem.” But it’s important to note how young Under Armour’s women’s apparel business is.

Kevin Plank discussed this on the earnings call. “Not even two years ago, the same person who handled women’s for us also handled our outlet supply as well as youth,” he said. “It was one woman and she did an amazing, Herculean job, but at competitors there would be 60, 80, 100 people doing that. Now we have half a dozen people on our women’s team, and the fact is we need about 20. I don’t know if people have seen our best stroke from Under Armour yet on women’s, but I’m proud we are on the board.”

Plank was also asked about “athleisure” and whether a dreaded “top” to the trend is coming soon. Plank says that won’t happen because this isn’t a momentary fad, but rather a “shift” in the way people dress.

This year Under Armour will hit $1 billion in sales of women’s product, most of it apparel. It’s making obvious progress in the category.

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Daniel Roberts is a writer at Yahoo Finance, covering sports business and technology. Follow him on Twitter at @readDanwrite. Sportsbook is our recurring sports business video series.

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