UAA Stock Jumps 20% on Q3 Earnings Beat & Raised FY26 Guidance

Core Insights - Under Armour, Inc. (UAA) reported third-quarter fiscal 2026 results with revenues decreasing and earnings increasing year over year, surpassing Zacks Consensus Estimates [1][3] - The company's shares have risen 20.4% since the earnings release on February 6, reflecting positive investor sentiment [1][2] - Management raised its fiscal 2026 outlook, indicating confidence in brand momentum and improving wholesale engagement despite ongoing revenue declines [2][9] Financial Performance - Adjusted earnings were reported at 9 cents per share, exceeding the Zacks Consensus Estimate of a loss of 2 cents, and up from 8 cents per share in the prior year [3] - Net revenues were $1,327.8 million, beating the consensus estimate of $1,309 million but down 5.2% from the previous year [3] - Wholesale revenues fell 6.4% to $660 million, while direct-to-consumer revenues dipped 3.9% to $646.8 million [4] Revenue Breakdown - Apparel revenues decreased 3.3% to $934 million, while footwear revenues dropped 12% to $265.1 million [5] - North American revenues declined 10.3% to $756.7 million, but international revenues rose 3% to $577 million [6] - Within the international segment, EMEA revenues increased 6% to $315.8 million, while Asia-Pacific revenues fell 5.1% to $190.9 million [7] Margin Analysis - Gross profit was $589.7 million, down 11.3% year over year, with gross margin contracting 310 basis points to 44.4% [8] - The decline in gross margin was attributed to supply-chain headwinds, including higher U.S. tariffs and pricing pressures [9] Operational Insights - Adjusted SG&A expenses decreased 7% to $563.3 million, primarily due to lower marketing spend [10] - The company reported an adjusted operating income of $26.4 million, down from $59.6 million in the previous year [10] Future Outlook - For fiscal 2026, revenues are projected to decline about 4%, with an expected 8% drop in North America and a 6% decline in Asia-Pacific [16] - Gross margin is anticipated to contract about 190 basis points, with SG&A expenses expected to fall at a low-double-digit rate [17][18] - The company now expects an operating loss of approximately $154 million, with adjusted earnings per share projected between 10 cents and 11 cents [19][20]