Under Armour sees another weak year as North America struggles, shares slump

In this Nov. 29, 2019, file photo Under Armour clothes are displayed at a Kohl's store in Colma, Calif.

Under Armour forecast another annual revenue decline and expects profit well below estimates on Tuesday, as weakness in its key North American market weighs on CEO Kevin Plank’s turnaround efforts.

Shares of the sportswear maker, which has reported sales declines for three straight years, tumbled 20 per cent in early trading to hit a five-month low of US$4.92.

Founder Plank, who returned as CEO in 2024, laid out a plan that involved reducing about 25 per cent of the company’s product lines and shifting to higher-priced items in categories such as training, running and team sports.

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“(We are) bringing an even sharper focus on editing and optimizing our product assortment, marketing spend, processes, and cost structure to improve UA’s profitability,” Plank said on a post-earnings call.

The company said it had extended its restructuring plan, with total costs now estimated at about $305 million and expected to be completed by the end of the year. Under Armour has incurred $261 million in restructuring costs since the program was launched in 2025.

“The company is trying to move away from heavy discounting and raise average selling prices, but this is becoming harder in a market shaped by tariffs, aggressive promotions and increasingly price-sensitive consumers,” said Patrick Ricciardi, analyst at Third Bridge.

The report underscored the mounting challenges Under Armour faces to stabilize its business amid intense competition from brands such as Nike, Lululemon, On Holding, Adidas and Puma.

For fiscal year 2027, Under Armour expects annual adjusted operating income in the range of $140 million to $160 million, which includes about $70 million in benefits from potential tariff refunds, along with a roughly $35 million hit from the conflict in the Middle East.

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The company also projected annual adjusted profit per share of between 8 cents and 12 cents, compared with analysts’ average expectation of 23 cents, according to data compiled by LSEG.

The apparel retailer expects revenue for its fiscal year 2027 to fall slightly, compared with analysts’ average expectation of a 1.6 per cent rise.

(Reporting by Sanskriti Shekhar in Bengaluru; Editing by Sriraj Kalluvila)