Under Armour reported mixed results for the quarter ended 30 June 2026, with overall revenue declining 3% year-on-year to $1.1bn. The athletic apparel maker faced particular weakness in its core markets, with North American sales falling 9% and Asia-Pacific dropping 7%. However, international operations showed more strength, with revenue rising 5% to $490m, driven by gains in EMEA, which increased 12%, and Latin America, up 8%.
Domestic channels struggled across the board, as wholesale revenue declined 2% while direct-to-consumer sales fell 6%, including a steeper 12% drop in eCommerce. Despite the top-line pressure, the company achieved a significant improvement in gross margin, which expanded 590 basis points to 54.1%, largely due to tariff refunds under the International Emergency Economic Powers Act that offset headwinds from currency fluctuations and pricing pressures.
Quarterly operating income totaled $47m, or $52m after excluding restructuring and transformation charges. Net income came in at $1m, with adjusted net income of $21m and diluted earnings per share flat on a reported basis and $0.05 on an adjusted basis. The company also reduced inventory 3% year-on-year to $1.1bn and maintained a cash position of $396m with $200m drawn on its revolving credit facility.
Looking ahead to fiscal 2027, Under Armour significantly reduced its revenue guidance, now expecting a mid-single-digit percentage decline rather than a slight decline. North America’s outlook deteriorated to a mid-single-digit drop from a low-single-digit decline, while Asia-Pacific and EMEA shifted to low-single-digit declines from previously anticipated low-single-digit growth. The company kept its operating income guidance unchanged at $96m to $116m, projecting a diluted loss per share of $0.01 to $0.05 compared with its prior range of breakeven to a loss of $0.04.
Management attributed the outlook reduction to challenging consumer demand conditions. CEO Kevin Plank noted the company is simplifying operations and investing in a “sharper product portfolio” aimed at achieving premium positioning and driving demand at full price, while continuing a restructuring plan that has incurred $266m in cumulative costs with total expected expenses of approximately $305m by the end of 2026.
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