Under Armour(US:UA) Changjiang Securities·2025-11-12 23:30Investment Rating - The industry investment rating is "Positive" and maintained [8] Core Insights - In FY2026Q2 (July 1, 2025 - September 30, 2025), the company achieved revenue of $1.33 billion, a year-on-year decrease of 4.7%, which outperformed market and company expectations [2][6] - Gross margin decreased by 2.5 percentage points to 47.3%, primarily due to increased tariffs and unfavorable channel and regional mix, while net margin turned negative to -1.4% [2][6] Revenue Breakdown - By region, North America and Asia-Pacific faced pressure, while EMEA showed robust growth. Revenue for FY2026Q2 was as follows: North America - $0.79 billion (-8.3% YoY), EMEA - $0.32 billion (+12.2% YoY), Asia-Pacific - $0.18 billion (-13.7% YoY), and Latin America - $0.05 billion (+14.6% YoY) [7] - By channel, wholesale and e-commerce sales were a drag. Revenue for FY2026Q2 was: wholesale - $0.78 billion (-6.2% YoY), DTC - $0.54 billion (-2.2% YoY) [7] - By product category, apparel sales slightly declined, while footwear sales continued to be under pressure. Revenue for FY2026Q2 was: apparel - $0.94 billion (-1.1% YoY), footwear - $0.26 billion (-15.7% YoY), and equipment - $0.11 billion (-2.8% YoY) [7] Inventory and Performance Guidance - As of FY2026Q2, the company's inventory amounted to $1.04 billion, a year-on-year decrease of 6%. The company is working to reduce inventory through stricter purchasing and faster seasonal decision-making [12] - The performance guidance indicates a projected revenue decline of 4% to 5% for FY2026, with Q3 expected to decline by 6% to 7% and a smaller decline in Q4. A turning point is anticipated in FY2027 [12]