Under Armour swings to loss, but sees ‘traction’ in turnaround; to hike some prices
A still struggling Under Armour posted fourth-quarter revenue and earnings results that managed to top analysts expectations as it continues its turnaround efforts.
The sports apparel and footwear brand did not provide a full-year outlook, citing uncertainty due to “evolving trade policies and the macroeconomic environment.” On its earnings call, Under Armour said it plans to raise prices on some of its products and diversify its supply chain as it looks to soften the impact from looming tariffs, reported Reuters.
Under Armour reported a net loss of $67 million, with a loss per share of $0.16, for the quarter ended March 31, compared to net income of $6.57 million, or $0.02 a share in the year-ago quarter. Excluding transformation expenses, restructuring charges and litigation settlement expense, the adjusted net loss was $35 million, with a loss per share of $0.08, in line with analysts’ forecasts.
Revenue fell 11% to $1.2 billion, which was not as much as big a drop as analysts expected. North American sales continued to decline, falling 11% to $689 million. International revenue decreased 13% to $489 million.
By category, apparel revenue fell 11%, footwear fell 17% and accessories inched down 2%.
Wholesale revenue decreased 10% to $768 million, and direct-to-consumer revenue fell 15% to $386 million. Revenue from owned and operated stores declined 6%. E-commerce revenue dropped 27% due to ongoing planned reductions in promotional activities, accounting for 37% of the total direct-to-consumer business for the quarter, the company said.
For the full year, revenue decreased 9% to $5.2 billion. The net loss was $201 million, with adjusted net income was $135 million.
In May 2024, Under Armour launched a restructuring plan to improve the company's financial and operational efficiencies. As part of the effort, the company is reducing 25% of its SKUs as it focuses on selling more premium, higher-priced products. It also is reducing in-store and online promotions.
“One year into our strategic reset, we're laying the groundwork for a more focused Under Armour,” stated Kevin Plank, who retook the reins as CEO in April 2024. “By elevating products and storytelling, tightening distribution, and refining our operating model, we are in the process of reigniting brand relevance and positioning the business for sustainable, profitable growth. Our fourth quarter performance contributed to fiscal 2025 results that were better than the expectations we set a year ago and we are demonstrating traction in our efforts to reposition the brand."
The company expects a first-quarter-quarter profit of $0.01 cent to $0.03 cents a share, while analysts were expecting it to break even.
"As we look toward fiscal 2026 amid a complex macroeconomic backdrop, our sharpened execution, alignment, and focus — bolstered by the move to a category-led operating model — equip us to navigate ongoing volatility with resilience," continued Plank. "I'm confident in the agility we've built over the past year, and we are raising our bar of excellence at Under Armour."
