Under Armour Reports Q2 2026 Results as Turnaround Momentum Builds

Under Armour reported a 5% drop in second-quarter revenue but expressed optimism about brand progress and operational discipline amid ongoing restructuring.​

Financial Highlights

• Revenue: $1.3 billion for Q2, down 5% year-over-year and 6% on a currency-neutral basis, but above the company’s previous expectations. North American revenue fell 8% to $792 million, while international revenue rose 2% to $551 million, including growth in EMEA (+12%) and Latin America (+15%), but a decline in Asia-Pacific (–14%).​
• Channels: Wholesale revenue was $775 million (–6% Y/Y), and direct-to-consumer revenue was $538 million (–2% Y/Y). Owned store sales were steady, but e-commerce sales declined 8%, making up 28% of DTC sales.​
• By Product: Apparel revenue slipped 1% to $936 million; footwear revenue declined 16% to $264 million; accessories revenue edged down 3% to $113 million.​

Margins and Expenses

• Gross Margin: Dropped 250 basis points to 47.3%, primarily due to supply chain headwinds, increased tariffs, and an unfavorable product mix, partially cushioned by price increases and favorable currency impacts.​
• SG&A Expenses: Rose 12% to $582 million, with adjusted SG&A (excluding $4 million in transformation charges) up 9% to $577 million. Growth was mainly due to higher marketing spend and the absence of a prior year’s $27 million insurance benefit.​
• Operating Income: $17 million reported, with $53 million in adjusted operating income when excluding transformation and restructuring costs.​
• Net Loss: $19 million (adjusted net income: $15 million). Diluted loss per share stood at $0.04 (adjusted EPS: $0.04).​

Liquidity, Inventory, and Buybacks

• Inventory: Declined 6% year-over-year to $1 billion.
• Cash: $396 million at quarter-end.
• Debt: $200 million drawn on a $1.1 billion revolver; proceeds were used to retire $600 million in senior notes.
• Share Buyback: $25 million repurchased (5.2 million Class C shares); $115 million total retired since May 2024.​

Restructuring Plan & Outlook

• Restructuring: $32 million in quarterly charges; $147 million accrued since program inception in 2024. The plan is expected to wrap by fiscal 2026-year end with total costs up to $160 million, focusing on process improvement, cost control, and margin recovery.​
• Fiscal 2026 Guidance:
  • Revenue expects a 4–5% decrease Y/Y with high-single-digit declines in North America and Asia-Pacific, offset by EMEA growth.
  • Gross margin is forecast to fall 190–210 basis points on higher tariffs and negative mix.
  • Adjusted SG&A to decline mid-single digits.
  • Operating income: $19–34 million; adjusted operating income: $90–105 million.
  • Adjusted diluted EPS: $0.03–$0.05.​

Leadership Perspective

Kevin Plank, President and CEO stated:
“We delivered results ahead of our prior outlook this quarter and are encouraged to see signs of brand momentum in North America, an important milestone in our turnaround… The response from consumers and partners reflects this execution, driven by stronger product, sharper storytelling, and a renewed belief in the Under Armour brand.”​

Under Armour’s Q2 showed that cost control, brand focus, and successful execution on turnaround initiatives can stabilize the business even as revenues remain pressured by headwinds in major markets.