Under Armour Reports 9.4% Revenue Decline in Fiscal Year 2025

Under Armour, Inc. reported a challenging fiscal year 2025, with total net revenues declining by 9.4% to $5.16 billion, down from $5.70 billion in fiscal 2024. The decrease was primarily driven by a drop in both wholesale and direct-to-consumer sales, which fell by 8.1% and 10.5%, respectively. Apparel sales decreased by 8.9%, while footwear sales saw a more significant decline of 12.8%. In contrast, accessories revenue increased slightly by 1.3%. The company's gross margin improved by 180 basis points to 47.9%, attributed to lower freight and product costs, as well as reduced discounting in the direct-to-consumer channel.

In response to the challenging market conditions, Under Armour initiated a restructuring plan in May 2024, which was later expanded to an estimated $140 million to $160 million in pre-tax charges. The restructuring plan aims to enhance operational efficiencies and is expected to be largely completed by the end of fiscal 2026. For fiscal 2025, the company incurred $89.2 million in restructuring and related charges, which included employee severance costs and facility-related expenses. The restructuring efforts are part of a broader strategy to stabilize the business and improve profitability.

Operationally, Under Armour's North America segment, which accounted for approximately 60% of total revenues, experienced a significant revenue decline of 11.4%. The EMEA region saw a slight increase of 0.4%, while Asia-Pacific and Latin America reported declines of 13.5% and 6.1%, respectively. The company also reported a total employee headcount of approximately 14,400 as of March 31, 2025, with a significant portion of employees working in retail and distribution roles.

Looking ahead, Under Armour's management expressed cautious optimism, emphasizing the importance of executing strategic initiatives to drive growth in the direct-to-consumer channel and expand wholesale distribution. The company is also focused on enhancing its digital strategy to improve consumer engagement. However, management acknowledged that ongoing macroeconomic factors, including inflation and global trade uncertainties, could continue to impact financial performance in the near term. The company remains committed to monitoring these factors closely and adapting its strategies accordingly.