Under Armour (UAA) Stock Plunges 13% on Disappointing Earnings and Grim Forecast

Key Takeaways

• UAA shares plummeted approximately 12-13% in premarket hours following disappointing Q4 results
• Company posted adjusted loss of $0.03 per share, worse than the anticipated $0.02 loss
• Quarterly revenue declined 1% year-over-year to $1.2 billion; North American sales plunged 7%
• Gross profit margin contracted due to tariff pressures, elevated product costs, and pricing challenges
• Fiscal 2027 outlook significantly missed expectations: $0.08–$0.12 EPS guidance versus $0.23 analyst consensus

Under Armour delivered disappointing fourth-quarter results on Tuesday, triggering a sharp sell-off that pushed shares down roughly 13% in premarket activity to about $5.21.

The athletic apparel manufacturer recorded an adjusted quarterly loss of $0.03 per share for the fourth quarter, falling short of the Street’s expectation for a $0.02 loss. While the variance was modest, investors responded harshly.

Quarterly sales totaled $1.2 billion, representing a 1% year-over-year contraction. The figure marginally surpassed Wall Street’s $1.17 billion projection, yet failed to counterbalance the earnings shortfall and conservative forward guidance.

Under Armour, Inc., UA

The North American market remains the company’s most challenging territory. Regional revenue decreased 7% to $641 million. International markets provided some relief with 10% growth reaching $539 million, though insufficient to compensate for domestic weakness.

Wholesale channel revenue also contracted, declining 3% to $747.7 million.

Profitability Challenges Mount

Gross margin deterioration emerged as a significant concern. On a GAAP basis, margins contracted 470 basis points to 42%. The adjusted margin declined 360 basis points to 43.1%.

Multiple factors contributed to the compression: elevated tariff costs, rising product expenses, pricing pressure, and unfavorable geographic sales mix. The convergence of these challenges created substantial headwinds.

For fiscal year 2026, Under Armour posted total revenue of $5.0 billion, representing a 4% year-over-year decline. Full-year adjusted earnings per share reached $0.12.

The company also reported a net loss of $496 million for fiscal 2026, incorporating a $247 million valuation allowance related to U.S. federal deferred tax assets.

Forward Guidance Disappoints Investors

The company’s outlook proved most concerning for investors. Under Armour projected fiscal 2027 adjusted earnings per share between $0.08 and $0.12. The midpoint of $0.10 represents a significant shortfall compared to the $0.23 analyst consensus.

The company anticipates another modest revenue decline in fiscal 2027.

Operating income guidance ranges from $96 million to $116 million. While this includes an expected $70 million benefit from anticipated tariff refunds, it’s partially offset by $35 million in headwinds from Middle East conflict impacts and $30 million in incremental marketing expenditures.

These marketing investments represent part of Plank’s comprehensive strategy to enhance brand positioning and narrative. The eventual payoff of this approach remains uncertain.

Under Armour’s fiscal 2027 projections reflect an organization navigating continued restructuring, managing external cost pressures, and attempting to revitalize brand strength.

UAA shares traded near $5.21 in premarket activity Tuesday, down from the previous closing price of $6.06.

The post Under Armour (UAA) Stock Plunges 13% on Disappointing Earnings and Grim Forecast appeared first on Blockonomi.