Under Armour, Inc. (NYSE:UA) reported first-quarter fiscal 2026 results that missed analyst expectations, causing its shares to drop sharply by 13.6% after the company issued a weak outlook that fell well below Wall Street forecasts.
The athletic apparel maker posted adjusted earnings per share of $0.02, slightly under the $0.03 estimate. Revenue declined 4% year over year to $1.1 billion, falling short of the consensus forecast of $1.13 billion. The company’s guidance for the second quarter was particularly disappointing, projecting earnings between $0.01 and $0.02 per share — far below the anticipated $0.26.
“We are pleased our quarterly results met or exceeded our expectations as we drive a bold transformation – sharpening Under Armour into a brand where sports credibility, innovation and style meet operational discipline,” said Kevin Plank, Under Armour’s President and CEO.
North American revenue slipped 5% to $670 million, while international sales dipped 1% to $467 million. Footwear sales were hit hardest, falling 14% to $266 million, whereas apparel revenue saw a modest 1% decline to $747 million. Accessories were a bright spot, growing 8% to $100 million.
Under Armour’s gross margin improved by 70 basis points to 48.2%, mainly benefiting from favorable currency movements, pricing, and product mix. However, the company expects gross margin to shrink by 340 to 360 basis points in the second quarter, citing supply chain challenges and anticipated tariff effects.
The company is moving forward with a restructuring plan unveiled in May 2024 aimed at boosting financial and operational efficiency. The restructuring is expected to cost between $140 million and $160 million, with $71 million already recognized in charges by the end of Q1.
Looking ahead to Q2, Under Armour forecasts a 6-7% revenue decline, including a mid-to-high single-digit drop in North America and a low-teen percentage fall in Asia-Pacific, partially offset by high-single-digit growth in the EMEA region.
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