VALUATION HIGHLIGHTS

1. Performance Apparel constitutes 66% of the Trefis price estimate for Under Armour's stock.
2. Footwear constitutes 23% of the Trefis price estimate for Under Armour's stock.

WHAT HAS CHANGED?

Latest Earnings: Q4 FY'2026

Under Armour reported Q4 FY'2026 revenue of $1.17 billion, down 1% year-over-year (down 4% in constant currency) as a 7% decline in North America was partially offset by 10% international growth. GAAP diluted EPS was a loss of $0.10, while adjusted EPS came in at -$0.03, reflecting compressed gross margins from higher tariff burdens and ongoing charges related to its restructuring initiative.

Note: Under Armour's FY'2026 ended on March 31, 2026.

Expanded Restructuring and SKU Rationalization

Under Armour has continued executing its strategic turnaround, expanding its restructuring plan to approximately $305 million to streamline operational processes and improve cost efficiencies. The company has trimmed total stock-keeping units (SKUs) by roughly 25% over the past two years to focus on higher-margin core apparel lines, reduce promotional reliance, and prepare for gross margin expansion heading into FY'2027.

POTENTIAL UPSIDE & DOWNSIDE TO TREFIS PRICE

Below are key drivers of Under Armour's value that present opportunities for upside or downside to the current Trefis price estimate:

North America & Direct-to-Consumer

• Gross Margin Recovery: Management forecasts gross margin growth of 220 to 270 basis points in FY'2027, driven by tariff relief, lower supply chain input costs, and SKU rationalization. Upside exists if promotional discipline accelerates margin normalization faster than expected.
• SG&A Cost Discipline: Adjusted SG&A expenses are projected to grow at a low single-digit rate in FY'2027 as operational efficiencies offset brand investments. Downside risk remains if higher-than-expected marketing costs or international tax headwinds erode profitability gains.

For additional details, select a division from the interactive Trefis split for Under Armour at the top of the page.

BUSINESS SUMMARY

Under Armour designs, markets, and distributes athletic performance apparel, footwear, and accessories globally. The company generates revenue primarily through wholesale channels and its Direct-to-Consumer segment, which includes brand house stores, factory outlets, and e-commerce platforms.

SOURCES OF VALUE

Apparel remains the most valuable segment for Under Armour, accounting for the vast majority of total revenue and operating profits.

Established Brand Equity in Performance Apparel

Under Armour maintains strong global brand recognition within core athletic performance categories, supported by long-standing technical innovations in moisture-wicking and compression fabrics across team sports and training segments.

Direct-to-Consumer Channel Scale

The Direct-to-Consumer business provides higher structural gross margins and direct control over pricing and inventory, allowing the company to engage consumers directly through e-commerce and factory house retail networks.

KEY TRENDS

Supply Chain Normalization and Tariff Shifts

The athletic apparel industry is adjusting to post-supply chain normalization and evolving international tariff structures. Expected reversals in specific import duties are paving the way for expanded gross margins across major industry players in upcoming fiscal years.

Product Rationalization and Direct-to-Consumer Focus

Footwear and activewear brands are actively curbing excessive promotional discounting by cutting lower-performing SKUs and refocusing capital on core, high-margin product franchises to drive profitable growth.