Under Armour cuts Q1 loss but sales fall; expects about $100M in costs due to tariffs
Under Armour continued to struggle in its first quarter as sales tumbled across regions. The company gave a downbear outlook, and warned that tariffs will cut into its profitability.
On the earnings call, CEO Kevin Plank addressed the incremental tariffs announced on July 31 and the “increased pressure” the company is facing this year. He said that, following those updates, the company estimates approximately $100 million in additional tariff-related costs along with softer than expected demand in fiscal 2026.
“When combined even with mitigation efforts and disciplined SG and A management, our profitability is projected to be about half of what it was last year,” Plank told analysts.
[READ MORE: Trump sets new tariff rates to take effect Aug. 7]
Under Armour reported a net loss of $3 million, or a loss of $0.01 a share, for the quarter ended June 30, compared to a loss of $305.4 million, or a loss of $0.70 a share, in the year ago quarter. Adjusted net income was $9 million, with adjusted earnings of $0.02 per share, just shy of analysts’ estimates of $0.03 per share.
Revenue fell 4% to $1.134 billion. Revenue in North America decreased 5% to $670 million. International sales fell 1% to $467 million.
Wholesale revenue decreased 5% to $649 million, and direct-to-consumer revenue fell 3% to $463 million. Revenue from owned and operated stores rose 1% while e-commerce revenue declined 12% and accounted for 31% t of the total direct-to-consumer business for the quarter.
Apparel sales inched down 1% to $747 million. Footwear sales plunged 14% to $266 million. Accessories were the only bright spot, with sales rising 8% to $100 million.
In May 2024, Under Armour announced a restructuring plan aimed at improving the company's financial and operational efficiencies. By the end of the first fiscal quarter of 2026, the plan had resulted in the company recording $71 million in restructuring and impairment charges, as well as $39 millionin other related transformational expense
Plank struck a positive note in the company’s earning statement, noting that first-quarter results exceeded its expectations “as we drive a bold transformation — sharpening Under Armour into a brand where sports credibility, innovation and style meet operational discipline."
“Despite ongoing uncertainty, our brand is gaining strength and we're executing our strategic plan with clarity and confidence,” he stated.
For its current quarter, Under Armour now expects earnings per share between $0.01 and $0.02, below analysts’ forecast of $0.26 per share. Revenue is expected to fall 6% to 7%.
Moving ahead, we’re focused on strengthening our brand positioning with premium products and increasing our average selling prices through innovative offerings, optimizing our top-volume programs, and creating a more compelling full, price-to-value proposition," Plank stated. "Regardless of the backdrop, this is about building a fearless, thoughtful and stronger Under Armour.”
