Revenue Performance - Revenue for Q2 fiscal 2025 decreased by 11% to $1.4 billion, with North America down 13% to $863 million and international revenue down 6% to $538 million[4] - For the three months ended September 30, 2024, Under Armour reported net revenues of $1,399,023, a decrease of 10.7% compared to $1,566,674 in the same period of 2023[14] - Under Armour's total net revenues for the six months ended September 30, 2024, were $2,582,688, down 10.4% from $2,883,639 in the same period last year[14] - The company's total net revenue growth for the six months ended September 30, 2024, was a decline of 10.4% on a GAAP basis, with currency-neutral net revenue growth also declining by 10.1%[21] Profitability Metrics - Net income for the quarter was $170 million, while adjusted net income was $131 million[4] - Under Armour's net income for the three months ended September 30, 2024, was $170,382, or $0.39 per diluted share, compared to a net income of $104,711, or $0.23 per diluted share, in the prior year[13] - For the six months ended September 30, 2024, Under Armour reported a net loss of $135,044, compared to a net income of $114,721 for the same period in 2023[19] - Adjusted net income for the six months ended September 30, 2024, was $134,770, compared to a loss of $135,044 on a GAAP basis[25] Cost Management - Gross margin increased by 200 basis points to 49.8%, driven by lower product and freight costs and reduced discounting levels[4] - Selling, general, and administrative expenses decreased by 15% to $520 million, with adjusted expenses down 13% to $530 million[4] - Gross profit for the three months ended September 30, 2024, was $696,132, representing a gross margin of 49.8%, up from 47.8% in the prior year[13] - The company incurred selling, general, and administrative expenses of $519,840, which accounted for 37.2% of net revenues, compared to 38.9% in the same period last year[13] Future Outlook - The company expects a low double-digit percentage decline in revenue for fiscal 2025, including a 14-16% decline in North America[7] - Gross margin is projected to increase by 125 to 150 basis points, up from a previous expectation of 75 to 100 basis points[7] - Operating loss is anticipated to be between $176 million and $196 million, an improvement from prior expectations of $220 million to $240 million[7] - Under Armour's outlook for the year ending March 31, 2025, includes an estimated adjusted income from operations ranging from $165 million to $185 million[28] Restructuring Efforts - The restructuring plan's total charges are expected to range from $140 million to $160 million, with $28 million recognized in restructuring and impairment charges to date[6] - The company plans to incur restructuring charges under its 2025 restructuring plan, estimated between $140 million and $160 million[29] - The estimated impact of charges under the 2025 restructuring plan is $33 million for the quarter ending December 31, 2024[31] - The company continues to focus on restructuring efforts to improve operational efficiency and financial performance[31] Asset and Liability Management - As of September 30, 2024, Under Armour's total assets decreased to $4,494,593, down from $4,760,734 as of March 31, 2024, representing a decline of approximately 5.6%[18] - Under Armour's total liabilities decreased to $2,509,392 as of September 30, 2024, from $2,607,448 as of March 31, 2024, a decrease of approximately 3.8%[18] - Under Armour's cash and cash equivalents decreased to $530,701 as of September 30, 2024, from $858,691 as of March 31, 2024, a decrease of approximately 38%[18] - The company experienced a significant increase in inventories, which rose to $1,105,884 as of September 30, 2024, compared to $958,495 as of March 31, 2024, an increase of about 15.4%[18] Shareholder Metrics - Diluted earnings per share was $0.39, with adjusted diluted earnings per share at $0.30[5] - For the three months ended September 30, 2024, the GAAP diluted net income per share was $0.39, while the adjusted diluted net income per share was $0.30[26] - The GAAP diluted net income per share is projected to be between $(0.07) and $(0.05) for the quarter ending December 31, 2024[32] - The adjusted diluted net income per share is projected to be between $0.02 and $0.04 for the same quarter[32] Operational Metrics - North America segment revenues decreased by 12.9% to $863,345 for the three months ended September 30, 2024, from $991,357 in 2023[14] - The EMEA region saw a slight decline of 1.4% in revenues, totaling $283,178 for the three months ended September 30, 2024, compared to $287,091 in the same period last year[14] - Direct-to-consumer sales decreased by 7.6% to $550,336 for the three months ended September 30, 2024, from $595,811 in the prior year[15] - Apparel sales decreased by 11.5% to $947,188 for the three months ended September 30, 2024, compared to $1,070,401 in the same period of 2023[16] Store Operations - As of September 30, 2024, Under Armour operates 196 total doors in North America, a slight decrease from 197 doors in 2023[33] - The total international doors decreased from 253 in 2023 to 250 in 2024[33] - The total number of doors operated by Under Armour is 446, down from 450 in the previous year[33] - The company has seen a decrease in the number of Brand House locations in North America from 19 in 2023 to 16 in 2024[33]

Core Viewpoint - Under Armour's stock has shown volatility, with significant movements following news releases, particularly related to the return of founder Kevin Plank and the company's financial updates [1][2]. Group 1: Leadership and Strategy - The return of Kevin Plank as founder is seen as a pivotal moment for Under Armour, potentially driving innovation and a clearer vision for the company [2]. - Historical data suggests that companies led by founders tend to perform better in terms of innovation and financial results, with founder CEOs showing 3.1 times better performance over a 15-year period [2]. Group 2: Financial Performance and Market Reaction - Under Armour announced higher FY25 restructuring charges of $140 to $160 million, which negatively impacted stock performance despite only a slight increase in operating loss expectations to $220 to $240 million [3]. - The adjusted EPS target was updated to $0.19 to $0.22, aligning with original estimates, indicating that the company is meeting prior expectations despite the restructuring news [3]. Group 3: Market Position and Valuation - Under Armour's stock trades at a significant discount compared to competitors like Lululemon and Nike, suggesting potential upside if the brand can regain its strength [4][6]. - The company has improved its gross margin to 47.5% by shifting towards premium pricing, which could enhance its valuation multiple [5]. Group 4: Future Outlook - The hiring of Eric Liedtke is expected to boost brand value, leveraging his experience in brand strategy and sustainable products [3]. - Investors are encouraged to view any stock weakness as a buying opportunity, with the potential for a turnaround under Plank's leadership to yield substantial returns [7].

Core Viewpoint - Under Armour's shares fell 9.6% due to increased restructuring costs and a revised outlook for operating losses in fiscal 2025, indicating challenges in its transformation strategy [1][2][3] Financial Performance - Under Armour's operating profits have turned to losses in 2024 for the first time since the pandemic, with projected operating losses for fiscal 2025 now estimated between $220 million to $240 million, up from an initial estimate of $194 million to $214 million [2][3] - The increase in projected losses is attributed to additional restructuring opportunities, including the closure of a distribution facility in Rialto, California, leading to an extra $70 million in restructuring charges by March 2026 [2] Restructuring and Transformation - The company plans to incur $140 million to $160 million in restructuring charges over the next two years, which includes severance and other investments [3] - Despite the increased charges, the forward outlook for non-GAAP (adjusted) operating income remains unchanged at $140 million to $160 million for the coming fiscal year [4] Market Reaction - Investors reacted negatively to the lowered profit outlook, resulting in a significant drop in stock price, although the long-term investment thesis may not have fundamentally changed [3][4] - Under Armour's current market cap is $2.8 billion, with the stock trading around 20 times the forward adjusted profit guidance, suggesting a valuation that is neither particularly cheap nor expensive [4]

Core Viewpoint - Under Armour is undergoing a strategic repositioning to restore its premium brand status, which has led to a decline in sales volume and expected losses in the short term, but improvements in gross margins are noted [1][3][4]. Financial Performance - Under Armour's stock has decreased by 6% year-to-date, currently trading at around $8, while peer Nike has seen a 24% decline [1]. - The company's revenue for Q1 was down 10% year-over-year to $1.2 billion, with North American sales dropping 14% and Asia Pacific sales down 10% [1]. - Gross margins have decreased from approximately 50% post-COVID to 47.5% in Q1 2025, although this represents a year-over-year increase of 110 basis points [1]. - For fiscal year 2025, revenue is forecasted to decline by 10% year-over-year, with a projected revenue of $5.1 billion [2][3]. Market Comparison - Under Armour's stock has underperformed the S&P 500 over the past three years, with returns of 21% in 2021, -51% in 2022, and -6% in 2023, compared to the S&P's respective returns of 27%, -19%, and 24% [2]. - The company's stock price is currently valued at $8 per share based on a revenue per share forecast of $11.33 and a 0.7x price-to-sales multiple for fiscal year 2025 [2]. Strategic Initiatives - The company is focusing on reducing inventory, which has decreased by 15% to $1.1 billion, and cutting back on online discounts to improve profitability [1]. - Under Armour expects to incur an operating loss of $194 million to $214 million for the full year due to higher expenses and restructuring charges related to its repositioning plan [3]. Consumer Behavior - There is a challenge in regaining premium brand status as consumers have become accustomed to lower prices, which may hinder the company's long-term profitability goals [4].

Revenue Performance - Total net revenues decreased by 10.1% for the three months ended June 30, 2024, compared to the same period in 2023[127]. - Wholesale revenue decreased by 8.3%, while direct-to-consumer revenue decreased by 11.8% during the same period[127]. - Total net revenues decreased by $133.3 million, or 10.1%, to $1,183.7 million for the three months ended June 30, 2024, compared to $1,316.9 million for the same period in 2023[138]. - Net sales decreased by $125.4 million, or 9.8%, to $1,160.7 million, primarily due to lower unit sales across all product categories[140]. - License revenues decreased by $3.4 million, or 13.6%, to $21.7 million, mainly due to lower revenues from licensing partners in North America and Japan[141]. - North America segment revenues decreased by $117.3 million, or 14.2%, to $709.3 million, while Latin America segment revenues increased by $8.7 million, or 15.6%[155]. - Total net revenues for the three months ended June 30, 2024, decreased by $117.3 million, or 14.2%, in North America, driven by declines in both wholesale and direct-to-consumer channels[156]. - EMEA region net revenues increased slightly by $0.3 million, or 0.1%, to $226.9 million, with growth in the direct-to-consumer channel[156]. - Asia-Pacific region net revenues decreased by $20.4 million, or 10.1%, to $181.8 million, impacted by lower revenues in both direct-to-consumer and wholesale channels[156]. - Latin America region net revenues increased by $8.7 million, or 15.6%, to $64.4 million, driven by growth in both wholesale and direct-to-consumer channels[156]. Profitability and Expenses - Gross margin increased by 110 basis points to 47.5%[127]. - Selling, general and administrative expenses increased by 42.1%, primarily due to a $274 million increase in litigation expenses related to a class action settlement[127]. - Selling, general and administrative expenses increased by $248.2 million, or 42.1%, to $837.3 million, driven by higher litigation reserves and transformational charges[145]. - Net income loss for the three months ended June 30, 2024, was $305.4 million, compared to a profit in the same period last year[135]. - Total operating loss for the three months ended June 30, 2024, was $299.7 million, a significant decline of 1,436.7% compared to an operating income of $22.4 million in the same period last year[157]. Restructuring and Charges - The company expects to incur total estimated pre-tax restructuring charges of approximately $70 million to $90 million during Fiscal 2025[129]. - Total costs recorded in restructuring charges for the three months ended June 30, 2024, amounted to $25.1 million[130]. - Restructuring charges amounted to $25.1 million, primarily due to employee-related charges and non-cash impairment charges[146]. Cash Flow and Capital Management - Cash flows from operating activities increased by $159.0 million, primarily due to a $467.0 million increase in working capital[169]. - Capital expenditures for the three months ended June 30, 2024, were $45.7 million, representing approximately 4% of net revenues, an increase of $13.1 million from the previous year[170]. - The company authorized a share repurchase program of up to $500 million through May 2027, with $40.0 million repurchased during the three months ended June 30, 2024[166]. - As of June 30, 2024, the company had approximately $884.6 million in cash and cash equivalents, sufficient to meet liquidity needs for at least the next twelve months[162]. Debt and Credit Facilities - The amended credit agreement provides for an aggregate $1.1 billion of revolving credit commitments, with a $50 million tranche maturing on December 3, 2026, and a $1.05 billion tranche maturing on December 3, 2027[172]. - As of June 30, 2024, there were no amounts outstanding under the revolving credit facility, and $4.2 million of letters of credit were outstanding[172]. - The company repaid $80.9 million of 1.50% convertible senior notes upon maturity, along with $0.6 million of accrued interest, using cash on hand[174]. - The company issued $600.0 million of 3.250% senior unsecured notes due June 15, 2026, with interest payable semi-annually[175]. - The amended credit agreement implemented SOFR as the benchmark interest rate for U.S. dollar borrowings, with applicable margins ranging from 1.00% to 1.75%[172]. - The company entered into an amendment to the credit agreement in July 2024 to exclude certain charges related to the settlement of Class Action Securities litigation from the definition of consolidated EBITDA[172]. - The company is required to maintain a consolidated EBITDA to consolidated interest expense ratio of not less than 3.50 to 1.0 and a consolidated total indebtedness to consolidated EBITDA ratio not greater than 3.25 to 1.0[172]. Market and Economic Factors - The company continues to monitor macroeconomic factors, including inflation and foreign currency fluctuations, that may impact financial results[133]. - The company has no significant changes to its market risk since March 31, 2024[177]. Accounting and Reporting - The company’s financial statements are prepared in accordance with U.S. GAAP, requiring estimates and assumptions that may significantly differ from actual results[176].

Is the company's turnaround plan actually working?Shares of athletic apparel company Under Armour (UA 18.64%) (UAA 19.32%) raced higher on Thursday after the company pleasantly surprised investors with its financial report for its fiscal first quarter of 2025. As of 11:30 a.m. ET, both share classes of Under Armour stock were up more than 17%.A plan to turn around the brandIn October 2019, Under Armour founder Kevin Plank stepped down as its CEO. The stock has drifted about 70% lower since then. The company ...

Core Viewpoint - Under Armour reported a significant decline in quarterly sales and adjusted its full-year profit guidance after settling a long-standing securities lawsuit for $434 million, although it exceeded Wall Street expectations for earnings and revenue [1][2]. Financial Performance - Quarterly sales fell to $1.18 billion, down approximately 10% from $1.32 billion a year earlier [2]. - The company reported a loss of $305.4 million, or 70 cents per share, compared to a profit of $10 million, or 2 cents per share, a year earlier [1]. - Adjusted earnings per share were 1 cent, beating the expected loss of 8 cents, while revenue surpassed expectations of $1.15 billion [1]. Lawsuit Settlement - Under Armour settled a securities lawsuit for $434 million, which accused the company of defrauding shareholders regarding revenue growth [2]. - The settlement will be paid using cash from its revolving credit facility, and the company did not admit fault or wrongdoing [2]. Future Guidance - The company now expects to incur losses in fiscal 2025, forecasting losses per share between 53 cents and 56 cents, and adjusted earnings per share between 19 cents and 22 cents [2][3]. - Previously, Under Armour anticipated full-year earnings of 2 cents to 5 cents per share and adjusted earnings between 18 cents and 21 cents per share [3]. Restructuring Efforts - Under Armour is undergoing a broad restructuring plan to regain market relevance, reverse sales decline, and boost profits, including layoffs and reduced promotions [3]. - The company aims to position itself as a premium brand, taking inspiration from Nike's strategy [3]. Sales Breakdown - In North America, sales dropped 14% to $709 million, better than the expected $669.1 million [4]. - Wholesale revenue decreased by 8% to $681 million, while direct-to-consumer sales fell 12% to $480 million [4]. - Online sales plummeted 25%, attributed to planned decreases in promotional activities [4]. Product Revenue Trends - Apparel revenue fell 8%, footwear sales dropped 15%, and accessories revenue slid 5% [4]. Strategic Acquisitions - Under Armour announced the acquisition of sustainable fashion brand Unless Collective, aiming to enhance its brand strategy and expand into sustainable fashion [4][5]. - Eric Liedtke, the founder of Unless Collective, will join Under Armour as executive vice president of brand strategy [5].

Exhibit 99.1 UNDER ARMOUR REPORTS FIRST QUARTER 2025 RESULTS; UPDATES FISCAL 2025 OUTLOOK BALTIMORE, Aug. 8, 2024 – Under Armour, Inc. (NYSE: UA, UAA) announced unaudited financial results for its first quarter fiscal 2025, which ended June 30, 2024. The company reports its financial performance following accounting principles generally accepted in the United States of America ("GAAP"). This press release refers to "currency neutral" and "adjusted" amounts, which are non-GAAP financial measures described be ...

Core Insights - Under Armour, Inc. has announced the acquisition of UNLESS COLLECTIVE, INC, a zero-plastic regenerative fashion brand, with Eric Liedtke joining as Executive Vice President of Brand Strategy following the completion of the acquisition [1][2][3] Company Overview - Under Armour is a leading inventor, marketer, and distributor of branded athletic performance apparel, footwear, and accessories, headquartered in Baltimore, Maryland [7] - The company aims to empower human performance through innovative products and experiences designed to enhance athletic capabilities [7] Leadership Changes - Eric Liedtke, with a 26-year career at adidas Group, will oversee Under Armour's brand identity, strategic planning, and transformational initiatives to accelerate growth while continuing to lead UNLESS [1][2][3] - Liedtke is recognized for his exceptional leadership and consumer-centric growth strategies, having previously orchestrated significant revenue growth at adidas [4][3] Strategic Goals - Under Armour aims to refine its operating model and enhance consumer engagement through Liedtke's leadership, focusing on brand storytelling and loyalty [2][3] - The company sees potential for growth among new and existing consumers by elevating its brand and redefining its narrative [3][4] UNLESS COLLECTIVE, INC Overview - UNLESS is the world's first all-plant, zero-plastic regenerative fashion brand, focusing on sustainable clothing and apparel that can be safely returned to the environment [5][6] - The brand is a collaboration of innovators and activists working towards a plastic-free future through plant-based innovation [5][6]

BALTIMORE, July 24, 2024 /PRNewswire/ -- Under Armour, Inc. (NYSE: UA, UAA) plans to release its first quarter fiscal 2025 (ended June 30, 2024) results on August 8, 2024. Following the news release at approximately 7:00 a.m. Eastern Time (ET), Under Armour management will host a conference call at approximately 8:30 a.m. ET to review results. This call will be webcast live and archived at https://about.underarmour.com/investor-relations/financials. About Under Armour, Inc. Under Armour, Inc., headquartered ...