Key Moments
- Under Armour now projects full-year revenue to decline by a mid-single-digit percentage, versus its earlier view of a “slight decline”.
- North America revenue dropped 9% to $609.8 million in the quarter ended June 30, amid softer consumer demand and inflationary pressure.
- Despite weaker sales, the company kept its full-year operating income forecast, supported by cost controls and restructuring initiatives.
Sales Outlook Darkens as Consumers Pull Back
Under Armour on Friday signaled a sharper decline in annual revenue, highlighting the difficulty of reigniting growth as consumers curb spending on athletic apparel in an uncertain economic backdrop, particularly in North America.
Shares of the company were down about 4% in premarket trading.
Persistent inflation and a more cautious spending environment have dampened demand for apparel, footwear and accessories in the region, adding pressure to Under Armour’s efforts to engineer a turnaround.
North America Performance and Updated Guidance
Revenue from Under Armour’s North America segment, its largest market, fell 9% to $609.8 million in the quarter ended June 30.
The company stated that it now anticipates full-year revenue to decline by a mid-single-digit percentage, compared with its previous expectation of a “slight decline”.
| Metric | Latest Figure / Guidance | Prior / Comparison |
|---|---|---|
| North America revenue (quarter ended June 30) | $609.8 million | Down 9% |
| Total quarterly revenue | $1.10 billion | Analysts’ estimate: $1.11 billion (LSEG) |
| Adjusted profit per share | 5 cents | Above analysts’ estimates |
| Full-year revenue outlook | Mid-single-digit percentage decline | Previously: “slight decline” |
Turnaround Strategy Under Returning CEO
Kevin Plank, who returned to the CEO role in 2024, has been steering a turnaround plan aimed at repositioning the brand. The effort includes cutting the company’s product assortment by about 25% and placing greater emphasis on higher-priced products in categories such as training, running and team sports.
As part of this strategy, Under Armour has introduced new offerings, including training shoes “Surge 5,” “Radiant TR” and baseball cleats “Leadoff Icon Mid,” with prices ranging from about $30 to $275. The company has also rolled out jackets, hoodies and other sports accessories designed to appeal to younger Gen Z consumers.
Under Armour reported that it has incurred $266 million in restructuring and transformation costs to date and expects to complete the plan by the end of the year.
“There isn’t much evidence that its turnaround efforts are having a significant impact,” Morningstar analyst David Swartz said.
Profitability Outlook and One-Off Impacts
Despite lowering its sales expectations, Under Armour kept its full-year operating income forecast intact, supported by cost-control actions.
The profit outlook factors in an approximately $70 million benefit tied to refunds related to International Emergency Economic Powers Act (IEEPA) tariff costs in fiscal 2026, as well as an estimated $35 million negative impact linked to the Middle East conflict.
Quarterly Results Versus Expectations
The apparel maker’s quarterly revenue declined 3% to $1.10 billion, slightly below the analysts’ average estimate of $1.11 billion, based on data compiled by LSEG. However, adjusted profit per share of 5 cents came in ahead of expectations.
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