Under Armour Beats Q1 Estimates Despite Sales Dip, Shows Restructuring Progress

Under Armour Inc UAA UA stock gained after the company reported first-quarter 2025 results on Thursday.

The company reported a first-quarter sales decline of 10.1% year-over-year to $1.183 billion, beating the analyst consensus estimate of $1.140 billion.

The company’s adjusted EPS was $0.01, above the $0.08 consensus loss.

Wholesale revenue decreased 8% YoY to $681 million, and direct-to-consumer revenue was down 12% at $480 million.

Apparel revenue slipped 8%, Footwear revenue dropped 15%, and Accessories revenue decreased 5%. North American revenue decreased 14.2% to $709 million, and international revenue increased 2% to $473 million.

Gross profit decreased 7.9% to $562.67 million, and the gross margin expanded 110 basis points to 47.5%.

The company incurred an operating loss of $299.73 million in the quarter compared to an operating income of $22.42 million.

The company held $885 million in cash and equivalents as of June-end. Inventory was $1.1 billion, a 15% decrease.

In May 2024, Under Armour announced a restructuring plan estimated at $70 million – $90 million. So far, $34 million in charges have been incurred, with $19 million in cash and $15 million in non-cash. Remaining charges are expected in fiscal 2025.

In the quarter, UAA repurchased $40 million of its Class C common stock, reflecting 5.9 million shares retired, leaving ~$460 million under the authorization.

“We are encouraged by early progress in our efforts to reconstitute a premium positioning for the Under Armour brand and pleased with our first quarter fiscal 2025 results that were ahead of expectations,” said Under Armour President and CEO Kevin Plank. 

2025 Outlook: Under Armour expects revenue to be down at a low-double-digit percentage rate, including a 14% – 16% decline (previously 15% – 17% decline) in North America.

The company sees Adjusted EPS of $0.19 – $0.22 (prior $0.18 – $0.21) versus an estimate of $0.20.

Gross margin is expected to be up 75 to 100 basis points. Adjusted Operating income is expected to be $140 million to $160 million versus the previous expectation of $130 million to $150 million.

Price Action: UAA shares are trading lower by 11.3% at $6.98 in premarket at the last check Thursday.

Photo via Shutterstock

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