Core Insights - Under Armour's 2025 CURRY brand Asia tour, themed "Opening a Big Scene," successfully attracted over 10,000 fans and consumers during the event held in Chongqing [1] Group 1: Event Highlights - The CURRY CON sports gathering, a brand-first initiative, was a significant highlight of the Asia tour [1] - The event featured a strong participation from basketball fans and consumers, indicating a successful engagement strategy [1] Group 2: Social Responsibility Initiatives - During the Asia tour, the CURRY brand partnered with the Yao Foundation to launch the "Basketball Without Borders" charity program [1] - This initiative aims to provide facilities and equipment support to rural areas and organize girls' basketball leagues in rural primary schools, promoting equal opportunities for girls in basketball [1] - The project includes building facilities, donating equipment, and providing scientific training to help break down participation barriers and promote healthy growth among youth [1]

Core Viewpoint - The U.S. consumer spending is weak due to trade policy uncertainties and macroeconomic conditions, significantly impacting the performance of North American footwear and apparel brands [1][2]. Group 1: Company Performance - Under Armour reported a 4% year-over-year decline in revenue for Q1 of fiscal year 2026, totaling $1.1 billion, with a projected 6% decline for Q2 [1]. - Crocs, known for its "Croc" shoes, reported a net loss of approximately $428 million for Q2, with North American revenue down 6.5% year-over-year, and expects a further decline of 9% to 11% in Q3 [1]. Group 2: Impact of Tariffs - The U.S. tariffs on imports from countries like Vietnam and Indonesia have raised costs for major brands such as Nike, which estimates an additional $1 billion in costs due to tariffs [2]. - Gap anticipates an increase in costs between $250 million to $300 million due to the tariffs [2]. - Retailers may need to raise prices by 10% to 12% to offset these costs, which will ultimately affect U.S. consumers, particularly those with lower incomes [2]. Group 3: Consumer Behavior and Market Dynamics - U.S. consumers are cautious with non-essential spending, leading to decreased foot traffic in stores and a preference for cheaper alternatives [3]. - The footwear and apparel industry faces a dilemma: raise prices to maintain profit margins or absorb costs, which would severely impact profitability [3]. - A letter signed by 76 footwear brands, including Nike and Adidas, was sent to the White House, indicating that tariffs pose a "survival threat" to the industry [3].

Group 1 - The article reflects on a visit to a sporting goods store in Europe, highlighting the presence of a prominent Under Armour logo, suggesting a nostalgic connection to the brand [1] - The author emphasizes a belief in the efficiency of financial markets, indicating that most stocks generally reflect their true current value [1] - The best investment opportunities are identified as those in stocks that are less followed by average investors or those that do not accurately represent existing market opportunities [1]

Core Viewpoint - Under Armour Inc (UAA) has potential for a long-term turnaround but faces near-term margin pressure due to tariffs and wholesale uncertainty [1] Group 1: Analyst Ratings and Price Target - Analyst Lorraine Hutchinson from BofA Securities reiterated a Neutral rating and reduced the price target from $8 to $6.50 [1] - The company is expected to generate weaker sales and lower margins through fiscal years 2026 and 2027 primarily due to tariffs [1] Group 2: Financial Performance and Guidance - Under Armour reported adjusted earnings in line with expectations for the first quarter, with softer sales offset by cost control [2] - Management guided for second-quarter sales and margins to fall short of market expectations, anticipating a 6%-7% decline in sales and a gross margin contraction of 340-360 basis points [2] Group 3: Market Behavior and Stock Performance - Management noted that both consumers and wholesale partners have shown hesitance in purchasing behavior, with the second quarter expected to be the weakest sales growth quarter of the year [3] - At the time of publication, shares of Under Armour had declined by 4.50% to $5.20 [3]

Group 1 - Jian Sheng Group reported H1 2025 revenue, net profit attributable to shareholders, net profit excluding non-recurring items, and operating cash flow of 1.17 billion, 142 million, 136 million, and 252 million yuan respectively, with year-on-year growth of 0.19%, -14.46%, -15.84%, and 146.96% [1] - The decline in net profit is attributed to fluctuating tariffs, a weak market, and overstaffing, compounded by increased management expenses due to new executive hires [1] - In Q2 2025, revenue, net profit attributable to shareholders, and net profit excluding non-recurring items were 610 million, 82 million, and 75 million yuan respectively, with year-on-year declines of 1.52%, 2.23%, and 8.39% [1] Group 2 - Under Armour reported FY2026 Q1 revenue, operating profit, and net loss of 113.4 million, 3 million, and -3 million USD respectively, with year-on-year changes of -4.2%, a turnaround to profit, and a 99.1% increase in losses [2] - By product category, revenue from apparel, footwear, and accessories was 74.7 million, 26.6 million, and 10 million USD respectively, with year-on-year changes of -1.5%, 14.3%, and 8.1% [2] - The company expects FY2026 Q2 revenue to decline by 6% to 7%, considering ongoing uncertainties in trade policies and macroeconomic conditions [2] Group 3 - Huali Group reported H1 2025 revenue, net profit attributable to shareholders, and net profit excluding non-recurring items of 12.661 billion, 1.664 billion, and 1.677 billion yuan respectively, with year-on-year changes of 10.36%, -11.42%, and -9.12% [3] - In Q2 2025, revenue, net profit attributable to shareholders, and net profit excluding non-recurring items were 7.308 billion, 902 million, and 926 million yuan respectively, with year-on-year changes of 9.0%, -17.3%, and -13.3% [3] - The company is adjusting its customer structure and resource allocation to ensure timely delivery of orders amid macroeconomic pressures and rising costs due to trade disputes [3] Group 4 - The textile and apparel industry is experiencing weak brand consumption, with home textiles performing slightly better than clothing due to online sales and subsidies [4] - Manufacturing orders were poor from April to May, and Q3 is expected to remain pessimistic, prompting recommendations for companies with strong profit certainty and growth recovery logic [4] - Online sales data from Taobao and Tmall in July 2025 showed improvements in the growth rate of sports and leisure apparel, with notable increases in specific categories [4] Group 5 - As of August 7, the China Cotton 3128B Index was 15,191 yuan/ton, with a 0.25% increase, while the medium import cotton price index was 13,420 yuan/ton, also up by 0.25% [6] - The domestic cotton price is higher than the foreign cotton price by 1,771 yuan/ton, with the China Cotton 3128B Index up 3.27% year-to-date [6]

Company Overview - Proactive is a financial news publisher that provides fast, accessible, informative, and actionable business and finance news content to a global investment audience [2] - The company has a team of experienced and qualified news journalists who produce independent content [2] Market Focus - Proactive specializes in medium and small-cap markets while also covering blue-chip companies, commodities, and broader investment stories [3] - The news team delivers insights across various sectors including biotech and pharma, mining and natural resources, battery metals, oil and gas, crypto, and emerging digital and EV technologies [3] Technology Adoption - Proactive is recognized for its forward-looking approach and enthusiastic adoption of technology to enhance workflows [4] - The company utilizes automation and software tools, including generative AI, while ensuring that all content is edited and authored by humans [5]

Financial Data and Key Metrics Changes - First quarter revenue declined 4% to $1.1 billion, with regional results showing a 5% decline in North America, a 10% increase in EMEA, a 10% decline in APAC, and a 15% decline in Latin America [40][41] - Gross margin increased by 70 basis points year over year to 48.2%, driven by favorable foreign currency impacts and pricing benefits [43] - SG&A expenses decreased by 37% to $530 million, reflecting lower marketing and savings from restructuring efforts [44] Business Line Data and Key Metrics Changes - Apparel revenue declined 1%, footwear revenue decreased by 14%, while accessories grew by 8% [41][43] - The company is focusing on reducing SKUs by 25% and cutting materials by 30% for 2025 products to streamline operations and improve pricing [10][11] Market Data and Key Metrics Changes - North America is expected to see a low double-digit revenue decline, while EMEA is projected to deliver high single-digit growth [50] - APAC revenue is anticipated to decline at a low teen rate due to weak consumer sentiment [50] Company Strategy and Development Direction - The company is undergoing a transformation to become a more focused brand, emphasizing sports, style, and innovation while maintaining financial discipline [4][6] - A two-lever strategy is being implemented to address tariff impacts and improve brand health through premium product offerings and better pricing [57][58] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the challenging environment due to tariffs and limited consumer spending but remains optimistic about brand health and future growth [7][38] - The company expects operating income for fiscal 2026 to be roughly half of fiscal 2025 levels due to increased costs and demand pressures [49] Other Important Information - The company is focusing on building deeper connections with consumers and enhancing brand authenticity [6][7] - A renewed partnership with the NFL and various influencer collaborations are part of the strategy to engage younger demographics [31][34] Q&A Session Summary Question: How are tariffs impacting demand from wholesale partners? - Management noted that the tariff environment is challenging but emphasized that their strategy remains focused on creating desirable products and improving pricing power [56][57] Question: Can you elaborate on brand health improvements? - Management highlighted improvements in brand perception, particularly among the 18 to 34 demographic, and noted positive trends in sell-through rates for key products [60][62] Question: What is the outlook for the order book for the holiday season? - Management indicated that while there is some uncertainty due to tariffs, there is positive momentum with new product launches and retailer engagement [90][91]

PART I - FINANCIAL INFORMATION [Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) The company reported a **net loss of $2.6 million** for Q1 FY2026, a substantial improvement from the prior year, with total assets increasing to **$4.87 billion** and positive operating cash flow of **$48.9 million** Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2025 | March 31, 2025 | | :--- | :--- | :--- | | **Total Current Assets** | $2,902,858 | $2,329,097 | | Cash and cash equivalents | $910,985 | $501,361 | | Inventories | $1,141,829 | $945,836 | | **Total Assets** | **$4,865,191** | **$4,300,871** | | **Total Current Liabilities** | $1,895,375 | $1,109,143 | | Current maturities of long-term debt | $599,757 | $— | | **Total Liabilities** | **$2,990,762** | **$2,410,593** | | **Total Stockholders' Equity** | **$1,874,429** | **$1,890,278** | Condensed Consolidated Statement of Operations Highlights (in thousands) | Account | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net revenues | $1,134,068 | $1,183,665 | | Gross profit | $546,496 | $562,675 | | Income (loss) from operations | $3,323 | $(299,728) | | **Net income (loss)** | **$(2,612)** | **$(305,426)** | | **Diluted EPS** | **$(0.01)** | **$(0.70)** | Condensed Consolidated Statement of Cash Flows Highlights (in thousands) | Activity | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $48,852 | $152,975 | | Net cash used in investing activities | $(35,362) | $4,319 | | Net cash provided by (used in) financing activities | $387,303 | $(128,220) | | **Net increase in cash** | **$410,107** | **$26,244** | [Notes to the Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) Disclosures detail the **2025 restructuring plan** incurring **$12.8 million** in charges, a **$400 million** new senior note issuance, and an **$8.9 million** litigation settlement payment - The company issued **$400.0 million** in 7.25% senior unsecured notes due 2030, with proceeds intended to redeem or discharge the **$600.0 million** 3.25% senior notes due 2026 during the second quarter of Fiscal 2026[57](index=57&type=chunk)[58](index=58&type=chunk)[59](index=59&type=chunk) - A settlement was reached in the Derivative Actions, including the company implementing various corporate governance measures for three years and receiving a payment of **$8.9 million**, funded by insurance proceeds, on behalf of the defendants[73](index=73&type=chunk) 2025 Restructuring Plan Charges (in thousands) | Charge Category | Three Months Ended June 30, 2025 | Estimated Charges Remaining | | :--- | :--- | :--- | | Costs in restructuring charges | $12,828 | $30,203 | | Costs in SG&A expenses | $8,259 | $19,548 | | **Total restructuring & related charges** | **$21,087** | **$49,751** | Net Revenues by Product Category (in thousands) | Product Category | Q1 FY2026 | Q1 FY2025 | | :--- | :--- | :--- | | Apparel | $746,592 | $757,792 | | Footwear | $265,855 | $310,389 | | Accessories | $100,078 | $92,545 | | **Total Net Sales** | **$1,112,525** | **$1,160,726** | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=35&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Quarterly revenue declined **4.2%** due to market challenges, yet gross margin improved to **48.2%** and SG&A decreased **36.7%**, with **$911 million** in cash bolstering liquidity [Overview and Quarterly Results](index=38&type=section&id=Overview%20and%20Quarterly%20Results) Total net revenues decreased **4.2%** due to challenging market conditions, with Footwear revenue down **14.3%**, while gross margin improved **70 basis points** to **48.2%** - Key financial highlights for the quarter ended June 30, 2025 compared to the prior year include: total net revenues decreased **4.2%**, wholesale revenue decreased **4.6%**, direct-to-consumer revenue decreased **3.5%**, Footwear revenue decreased **14.3%**, and gross margin increased **70 basis points** to **48.2%**[156](index=156&type=chunk) [Results of Operations](index=40&type=section&id=Results%20of%20Operations) Net revenues decreased **4.2%** to **$1.13 billion**, primarily from a **14.3%** drop in Footwear, while gross margin improved to **48.2%** and SG&A expenses fell **36.7%** Revenue Breakdown and Change (in thousands) | Category | Q1 FY2026 | Q1 FY2025 | Change (%) | | :--- | :--- | :--- | :--- | | **By Product** | | | | | Apparel | $746,592 | $757,792 | (1.5)% | | Footwear | $265,855 | $310,389 | (14.3)% | | Accessories | $100,078 | $92,545 | 8.1% | | **By Channel** | | | | | Wholesale | $649,050 | $680,513 | (4.6)% | | Direct-to-consumer | $463,475 | $480,213 | (3.5)% | - Gross margin increased by **70 basis points**, driven by favorable foreign exchange (**+55 bps**), product mix (**+30 bps**), and pricing benefits (**+30 bps**), partially offset by unfavorable channel mix (**-30 bps**) and supply chain costs (**-15 bps**)[169](index=169&type=chunk) - SG&A expenses decreased by **$307.0 million** (**36.7%**), primarily due to lower litigation reserve expense compared to the prior year, which included costs for settling the Consolidated Securities Action litigation[171](index=171&type=chunk)[172](index=172&type=chunk) [Segment Results of Operations](index=44&type=section&id=Segment%20Results%20of%20Operations) North America revenue declined **5.5%**, while EMEA revenue grew **9.6%** with operating income surging **93.8%**, and Corporate Other's operating loss significantly narrowed Net Revenues by Geographic Segment (in thousands) | Region | Q1 FY2026 | Q1 FY2025 | Change (%) | | :--- | :--- | :--- | :--- | | North America | $670,319 | $709,260 | (5.5)% | | EMEA | $248,607 | $226,892 | 9.6% | | Asia-Pacific | $163,386 | $181,836 | (10.1)% | | Latin America | $54,575 | $64,409 | (15.3)% | Operating Income (Loss) by Geographic Segment (in thousands) | Region | Q1 FY2026 | Q1 FY2025 | Change (%) | | :--- | :--- | :--- | :--- | | North America | $121,437 | $147,889 | (17.9)% | | EMEA | $39,643 | $20,456 | 93.8% | | Asia-Pacific | $14,703 | $9,935 | 48.0% | | Latin America | $6,606 | $15,171 | (56.5)% | | Corporate Other | $(179,066) | $(493,179) | 63.7% | [Liquidity and Capital Resources](index=46&type=section&id=Liquidity%20and%20Capital%20Resources) The company holds **$911 million** in cash, with operating cash flow at **$48.9 million**, and issued **$400 million** in new senior notes while retaining **$410 million** for share repurchases - The company had approximately **$911 million** of cash and cash equivalents as of June 30, 2025[188](index=188&type=chunk) - On June 23, 2025, the company issued **$400 million** in aggregate principal amount of 7.25% senior unsecured notes due 2030[196](index=196&type=chunk)[207](index=207&type=chunk) - No shares were repurchased during the three months ended June 30, 2025, with approximately **$410 million** remaining under the current share repurchase program[192](index=192&type=chunk)[224](index=224&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=51&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) No significant changes to market risk have occurred since March 31, 2025, with further details available in the Fiscal 2025 Annual Report - There have been no significant changes to the company's market risk since March 31, 2025[214](index=214&type=chunk) [Controls and Procedures](index=51&type=section&id=Item%204.%20Controls%20and%20Procedures) Disclosure controls and procedures were deemed ineffective due to a material weakness in balance sheet account reconciliations, with remediation efforts ongoing through Fiscal 2026 - The Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were not effective due to a material weakness in internal control over financial reporting[215](index=215&type=chunk) - The material weakness relates to the company not designing and maintaining effective controls over the review and execution of certain balance sheet account reconciliations[216](index=216&type=chunk) - Remediation efforts are underway, including implementing a new account reconciliation policy, enhancing controls, and training process owners, with these efforts expected to continue throughout Fiscal 2026[217](index=217&type=chunk)[219](index=219&type=chunk) PART II - OTHER INFORMATION [Legal Proceedings](index=53&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in various legal proceedings, with specific details on certain matters referenced in Note 8 of the financial statements - The company refers to Note 8 of the Condensed Consolidated Financial Statements for information on certain legal proceedings[221](index=221&type=chunk) [Risk Factors](index=53&type=section&id=Item%201A.%20Risk%20Factors) No new risk factors are disclosed in this report, with comprehensive details available in the Fiscal 2025 Annual Report on Form 10-K - The company refers readers to the risk factors discussed in Part I, Item 1A of its Annual Report on Form 10-K for Fiscal 2025[222](index=222&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=53&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) No shares of Class C Common Stock were repurchased during the quarter, leaving approximately **$410.0 million** available under the repurchase program Issuer Purchases of Equity Securities (Q1 FY2026) | Period | Total Number of Shares Purchased | Average Price Paid per Share | Approx. Dollar Value Remaining Under Program (in millions) | | :--- | :--- | :--- | :--- | | April 2025 | — | $— | $410.0 | | May 2025 | — | $— | $410.0 | | June 2025 | — | $— | $410.0 | [Other Information](index=53&type=section&id=Item%205.%20Other%20Information) No director or officer adopted or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the quarter - No director or officer of the Company adopted or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the quarter[225](index=225&type=chunk) [Exhibits](index=54&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including indentures, credit agreement amendments, and officer certifications

Core Viewpoint - Under Armour's Q1 FY2026 earnings report indicates operational progress with improved gross margins and adjusted operating income, despite a decline in GAAP revenue and adjusted EPS falling short of expectations [1][2][3] Financial Performance - GAAP revenue for Q1 FY2026 was $1,134 million, a decrease of 4.2% year-over-year and 2.0% below analyst expectations of $1,155 million [1][3] - Adjusted EPS was $0.02, below Wall Street's estimate of $0.03, reflecting ongoing sales declines and an uncertain outlook [2][3] - Adjusted operating income increased to $24 million from $8 million in the prior year, while GAAP net income improved to -$2.6 million from -$305 million [10][11] Revenue Trends - North America, Under Armour's largest market, saw a 5.5% revenue decline to $670 million, while international revenue fell 1% to $467 million [6] - EMEA revenue grew by 9.6% to $248.6 million, contrasting with declines in Asia-Pacific (down 10.1%) and Latin America (down 15.3%) [6] - Direct-to-consumer (DTC) sales contracted by 3.5%, with e-commerce revenue shrinking by 12% [7][13] Product and Market Dynamics - Apparel revenue decreased by 1.5%, while footwear revenue dropped 14.3%, indicating competitive challenges [8] - Accessories revenue increased by 8.1%, showcasing some product category resilience [8] - The company is focusing on premiumization and brand strength through high-profile partnerships and innovative product launches [5][12] Strategic Focus Areas - Under Armour is prioritizing digital engagement and expanding its DTC and e-commerce channels, despite a deliberate pullback on discounting [5][13] - Supply chain management remains critical, with ongoing risks related to sourcing and tariffs [14] - The company aims to streamline operations and cut costs through a transformation plan, expecting annual savings of $75 million by the end of FY2026 [11][12] Future Outlook - For Q2 FY2026, management anticipates a revenue decline of 6-7%, with gross margin projected to drop by 3.4-3.6 percentage points [16] - Adjusted operating income is expected to be in the range of $30-40 million, with adjusted diluted EPS forecasted between $0.01 and $0.02 [16] - There is significant uncertainty regarding tariffs, cost inflation, and consumer demand, leading to no full-year guidance [16][17]

[Executive Summary & Business Overview](index=1&type=section&id=Executive%20Summary%20%26%20Business%20Overview) This section outlines Under Armour's Q1 FY2026 performance, emphasizing management's strategic focus on brand strengthening and product innovation [Management Commentary](index=1&type=section&id=Management%20Commentary) Under Armour's CEO reported Q1 results met expectations amid transformation, focusing on premium products and brand strengthening despite market uncertainty - Quarterly results met or exceeded expectations while the company undergoes a significant transformation[2](index=2&type=chunk) - Strategic focus is on enhancing brand positioning with premium products, increasing average selling prices through innovation, and optimizing top-volume programs[2](index=2&type=chunk) [First Quarter Fiscal 2026 Financial Performance](index=1&type=section&id=First%20Quarter%20Fiscal%202026%20Financial%20Performance) Under Armour's Q1 FY2026 saw a 4% revenue decline to $1.1 billion, with mixed financial results and an increase in cash and inventories [Key Financial Highlights](index=1&type=section&id=Key%20Financial%20Highlights) Q1 FY2026 saw a 4% revenue decline to $1.1 billion, with GAAP operating income of $3 million and net loss of $3 million, while gross margin improved to 48.2% Q1 FY2026 Key Financial Metrics | Metric | Q1 FY2026 | Change (YoY) | | :--- | :--- | :--- | | **Revenue** | $1.1 billion | -4% | | **Gross Margin** | 48.2% | +70 bps | | **Operating Income** | $3 million | N/A (vs. loss) | | **Adjusted Operating Income** | $24 million | +204.5% | | **Net Loss** | $3 million | N/A (vs. larger loss) | | **Adjusted Net Income** | $9 million | +148.0% | | **Diluted EPS** | -$0.01 | N/A (vs. -$0.70) | | **Adjusted Diluted EPS** | $0.02 | +100% | - Gross margin increased to **48.2%** primarily due to favorable foreign exchange, pricing, and product mix, which was partially offset by unfavorable channel mix and higher supply chain costs[3](index=3&type=chunk) - SG&A expenses decreased significantly by **37% to $530 million**, mainly because the prior year included a large legal reserve expense, with adjusted SG&A decreasing by 6%[3](index=3&type=chunk) [Revenue Analysis](index=1&type=section&id=Revenue%20Analysis) Total revenue declined 4% to $1.1 billion, with North America down 5% and international down 1%, driven by decreases in wholesale, DTC eCommerce, and footwear Q1 FY2026 Revenue Breakdown by Geography | Region | Revenue (USD) | Change (YoY) | Currency Neutral Change | | :--- | :--- | :--- | :--- | | **North America** | $670 million | -5% | -5% | | **International** | $467 million | -1% | -2% | | *EMEA* | $249 million | +10% | +6% | | *Asia-Pacific* | $163 million | -10% | -10% | | *Latin America* | $55 million | -15% | -8% | Q1 FY2026 Revenue Breakdown by Channel & Product | Category | Revenue (USD) | Change (YoY) | | :--- | :--- | :--- | | **Wholesale** | $649 million | -5% | | **Direct-to-Consumer** | $463 million | -3% | | **Apparel** | $747 million | -1% | | **Footwear** | $266 million | -14% | | **Accessories** | $100 million | +8% | - Within the Direct-to-Consumer segment, revenue from owned and operated stores increased by **1%**, but this was offset by a **12% decline in eCommerce revenue**[3](index=3&type=chunk) [Balance Sheet and Cash Flow](index=2&type=section&id=Balance%20Sheet%20and%20Cash%20Flow) As of June 30, 2025, cash and equivalents reached $911 million, inventories rose to $1.1 billion, and operating cash flow was $49 million, with no credit facility borrowings Key Balance Sheet Items (as of June 30, 2025) | Item | Amount (USD) | Change from Mar 31, 2025 | | :--- | :--- | :--- | | **Cash and cash equivalents** | $911.0 million | +$409.6 million | | **Inventories** | $1,141.8 million | +$196.0 million | | **Total Assets** | $4,865.2 million | +$564.3 million | | **Total Liabilities** | $2,990.8 million | +$580.2 million | - The company raised **$400 million in senior notes** during the quarter, intending to use the proceeds to retire $600 million in senior notes due June 2026[5](index=5&type=chunk) - Net cash provided by operating activities was **$48.9 million**, a decrease from $153.0 million in the prior year's quarter, primarily due to changes in operating assets and liabilities[26](index=26&type=chunk) [Fiscal 2025 Restructuring Plan](index=2&type=section&id=Fiscal%202025%20Restructuring%20Plan) This section details the Fiscal 2025 Restructuring Plan, outlining its estimated costs and the charges incurred to date by Q1 FY2026 [Restructuring Plan Update](index=2&type=section&id=Restructuring%20Plan%20Update) The Fiscal 2025 Restructuring Plan, estimated at $140-$160 million, has incurred $110 million in charges by Q1 FY2026, with remaining charges expected by end of FY2026 Restructuring Plan Costs (as of Q1 FY2026) | Metric | Amount (USD) | | :--- | :--- | | **Total Estimated Cost** | $140M - $160M | | **Total Charges Incurred to Date** | $110 million | | *Restructuring & Impairment Charges* | $71 million | | *Other Transformational Expenses* | $39 million | | **Cash-Related Charges Incurred** | $65 million | | **Non-Cash-Related Charges Incurred** | $45 million | - The company anticipates recognizing the remaining charges associated with the restructuring plan by the end of fiscal 2026[4](index=4&type=chunk) [Second Quarter Fiscal 2026 Outlook](index=2&type=section&id=Second%20Quarter%20Fiscal%202026%20Outlook) This section provides Under Armour's Q2 FY2026 guidance, projecting revenue decline, gross margin compression, and an operating loss due to market headwinds [Q2 FY2026 Guidance](index=2&type=section&id=Q2%20FY2026%20Guidance) Q2 FY2026 outlook projects a 6-7% revenue decline, a 340-360 bps gross margin drop due to tariffs, and a GAAP operating loss of $10 million to breakeven Q2 FY2026 Outlook | Metric | Guidance | | :--- | :--- | | **Revenue** | Decline 6% to 7% | | **Gross Margin** | Decline 340 to 360 bps | | **Operating Income (Loss)** | ($10) million to $0 million | | **Adjusted Operating Income** | $30 million to $40 million | | **Diluted Loss Per Share** | ($0.07) to ($0.08) | | **Adjusted Diluted EPS** | $0.01 to $0.02 | - The expected gross margin decline is primarily attributed to supply chain headwinds from tariffs and an unfavorable channel mix[6](index=6&type=chunk) - Adjusted SG&A is expected to grow at a high-single-digit rate, driven by higher marketing investments compared to the prior year when spending was shifted to the second half[6](index=6&type=chunk) [Financial Statements and Reconciliations](index=5&type=section&id=Financial%20Statements%20and%20Reconciliations) This section presents Under Armour's Q1 FY2026 consolidated financial statements, including income, balance sheet, cash flow, non-GAAP reconciliations, and store count [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Q1 FY2026 net revenues were $1.134 billion, with gross profit at $546.5 million, resulting in an operating income of $3.3 million and a net loss of $2.6 million Q1 FY2026 Income Statement (in thousands) | Line Item | Q1 2025 (ended Jun 30) | Q1 2024 (ended Jun 30) | | :--- | :--- | :--- | | **Net revenues** | $1,134,068 | $1,183,665 | | **Gross profit** | $546,496 | $562,675 | | **Income (loss) from operations** | $3,323 | $(299,728) | | **Net income (loss)** | $(2,612) | $(305,426) | | **Diluted net income (loss) per share** | $(0.01) | $(0.70) | [Condensed Consolidated Balance Sheets](index=8&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2025, total assets reached $4.87 billion, with cash at $911 million and inventories at $1.14 billion, while total liabilities increased to $2.99 billion Balance Sheet Highlights (in thousands) | Account | June 30, 2025 | March 31, 2025 | | :--- | :--- | :--- | | **Cash and cash equivalents** | $910,985 | $501,361 | | **Inventories** | $1,141,829 | $945,836 | | **Total current assets** | $2,902,858 | $2,329,097 | | **Total assets** | $4,865,191 | $4,300,871 | | **Total current liabilities** | $1,895,375 | $1,109,143 | | **Total liabilities** | $2,990,762 | $2,410,593 | | **Total stockholders' equity** | $1,874,429 | $1,890,278 | [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Q1 FY2026 saw $48.9 million in operating cash, $35.4 million used in investing, and $387.3 million provided by financing, leading to a $410.1 million net cash increase Cash Flow Summary (in thousands) | Cash Flow Activity | Three Months Ended June 30, 2025 | | :--- | :--- | | **Net cash provided by operating activities** | $48,852 | | **Net cash used in investing activities** | $(35,362) | | **Net cash provided by financing activities** | $387,303 | | **Net increase in cash** | $410,107 | | **Cash at end of period** | $925,158 | [Non-GAAP Reconciliations](index=10&type=section&id=Non-GAAP%20Reconciliations) Q1 FY2026 non-GAAP reconciliations show adjusted operating income of $24.4 million, adjusted net income of $8.6 million, and adjusted diluted EPS of $0.02, primarily excluding restructuring charges - Currency-neutral net revenue declined **4.4%** in Q1, slightly worse than the GAAP decline of 4.2%, indicating a small positive impact from foreign exchange[28](index=28&type=chunk) Q1 FY2026 GAAP to Non-GAAP Reconciliation | Metric | GAAP | Adjustments | Non-GAAP (Adjusted) | | :--- | :--- | :--- | :--- | | **Operating Income** | $3.3M | +$21.1M | $24.4M | | **Net Income (Loss)** | ($2.6M) | +$11.2M | $8.6M | | **Diluted EPS** | ($0.01) | +$0.03 | $0.02 | Q2 FY2026 Outlook GAAP to Non-GAAP Reconciliation | Metric | GAAP Outlook | Adjustments | Non-GAAP Outlook | | :--- | :--- | :--- | :--- | | **Operating Income** | ($10M) - $0M | +$40M | $30M - $40M | | **Diluted EPS** | ($0.08) - ($0.07) | +$0.09 | $0.01 - $0.02 | [Company-Owned & Operated Door Count](index=14&type=section&id=Company-Owned%20%26%20Operated%20Door%20Count) As of June 30, 2025, Under Armour operated 442 stores globally, a net increase of one, with North American stores decreasing and international stores increasing Store Count as of June 30 | Region | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | **North America** | 195 | 200 | -5 | | **International** | 247 | 241 | +6 | | **Total Doors** | **442** | **441** | **+1** |