Under Armour Inc (UAA) (Q2 2027) Earnings Call Highlights: Revenue Slips 7% as Turnaround Presses On

Release Date: November 06, 2026

For the complete transcript of the earnings call, please refer to the full earnings call transcript .

Positive Points

• Under Armour Inc ( NYSE:UAA ) exceeded its adjusted operating income outlook for the quarter while delivering revenue in line with expectations.

• The company's football cleated business grew double digits with higher average selling prices and market share gains, becoming the number two brand in US football cleats.

• Under Armour Inc ( NYSE:UAA ) is simplifying its product line, targeting a nearly 50% reduction in SKUs and removing over 60% of materials, which should improve focus and efficiency.

• The company is transitioning its youth apparel business to a licensing model with Centric Brands, expected to reduce inventory, working capital, and operating complexity starting fall 2027.

• Under Armour Inc ( NYSE:UAA ) is investing in AI for supply chain, merchandising, and marketing to compress calendars and speed up product innovation to market.

Negative Points

• Under Armour Inc ( NYSE:UAA ) reported a 7% revenue decline to $1.2 billion, with North America down 7%, EMEA down 9%, and APAC down 9%, reflecting broad demand pressure.

• Gross margin decreased 30 basis points to 47%, due to unfavorable foreign currency, channel and regional mix, and higher discounting.

• Inventory increased 4% year-over-year to $1.1 billion, above plan due to a $200 million revenue outlook reduction, requiring targeted sell-through actions.

• The company lowered its fiscal 2027 gross margin outlook by 50 basis points to 170-220 basis points expansion, citing elevated fuel and freight costs, markdowns, and a stronger US dollar.

• Third quarter revenue is expected to decline 8-9%, with North America down low double digits, and adjusted operating income projected between a loss of $5 million and a profit of $5 million.

Q & A Highlights

Q: Simeon Siegel (Guggenheim) asked how Under Armour translates product innovation excitement into pricing power and margins, the timeline for North America revenue stabilization, and the drivers behind the stronger fourth quarter embedded in guidance. A: CEO Kevin Plank said the biggest gap is "competent storytelling," not product, and outlined a three-part fix: product (cutting SKUs, leaning into HeatGear/ColdGear and new launches like the $35 Tech Helix and $80 Armour Short), marketing (one major global product story per month under the "This Is Your Armor" platform), and distribution (rebuilding e-commerce for full-price selling with partners like DICK'S and JD). CFO Reza Taleghani added that gross margin should improve for the year even in a promotional US/UK market, with premiumization meaning selling more at full price.

Q: Jay Sole (UBS) asked which metrics show the brand is trending with consumers and what drove the incremental 50 basis points of gross margin guidance reduction. A: Plank said Q2 consumer consideration rose over 19% year-over-year and brand perception over 24%, and that marketing is shifting from performance/discount spending toward product storytelling. Taleghani said pricing and favorable channel/product mix are positives, but the single biggest negative is supply chain headwinds mainly logistics and freight costs plus some unfavorable FX translation.

Q: Sam Poser (Williams Trading) asked how Under Armour will avoid over-buying new launches like the Armour Short given elevated inventory, and whether it can use its own DTC data to test demand before committing to retail buyers. A: Taleghani said buys are based on regional demand signals, new-launch inventory is high quality and can be managed through sell-through monitoring and adjusted future buys; the 4% inventory increase stems largely from the $200 million revenue cut taken in August after goods were already in flight. Plank said the company wants early reads and a "test and learn" approach testing on ua.com and select doors before making big bets while compressing its go-to-market calendar.

Q: Bob Drbul (BTIG) asked what "asset-light" means in practice and which other areas could be considered, and what is missing in the challenged footwear business. A: Plank said the brand's time is roughly split one-third manufacturing, one-third marketing, one-third retail, and Under Armour wants to shift toward brand-building and marketing while leaning on factory and retail partners. The youth apparel licensing deal with Centric Brands (starting fall 2027) is an early test. On footwear, a $1 billion business, he cited strong innovation but weak storytelling and segmentation; running grew in Q2 and UA is now the No. 2 football cleat brand in the US.

Q: Laurent Vasilescu (BNP Paribas) asked how to quantify the 50% SKU reduction in revenue terms, when it benefits gross margin, and when the North American marketplace will be clean given a large competitor's inventory sell-in. A: Plank said the benefit is being felt internally through less product weight and clearer good/better/best architecture, but the 1824 month go-to-market cycle delays visible results; higher ASPs on launches like the Assert 11 are an early proof point. Taleghani said material rationalization helps product costing, but current freight costs cloud the picture. Plank declined to speak for competitors, saying UA must focus on itself amid heavy industry clearance activity.

Q: Brooke Roach (Goldman Sachs) asked about changes to North America stores, early results from adding full-price product to factory stores, and the drivers of the Q4 operating margin inflection. A: Plank said premium products like the $45 StealthForm cap are being introduced into Factory House doors, with a target of double-digit full-price product in that mix, and ASPs are a key daily/weekly metric. Taleghani said Q4 includes a couple of points from the youth transition and a few points from wholesale inventory-reduction initiatives in North America, plus about 5 points of EMEA distributor shipments shifting from Q3 to Q4, alongside SG&A actions bearing fruit.

Q: Peter McGoldrick (Stifel) asked for the economics of the kids licensing deal existing revenue run rate, operating income contribution, and net contribution after transition and about pricing contribution in Q4. A: Taleghani said youth remains strategic and UA will still sell it in DTC; the deal covers North America and EMEA (not APAC), and details on royalties, transfer costs and inventory commitments will come with the fiscal 2028 outlook in May. The objective is to retain earnings and cash as royalties replace product sales. On pricing, he said actions were taken but are partly offset by heavy promotions in North America and the UK across wholesale and DTC.

Q: Sam Poser (Williams Trading) asked how big Tech Helix could be, how it builds into fiscal 2028, and whether revenue growth is expected in 2028. A: Plank declined to guide fiscal 2028, taking it "one quarter at a time," but said Helix is a multimillion-unit program with potential to be a top-10 volume driver over time. Of the 12 planned launches over the next 12 months, roughly five or six are existing products UA isn't getting enough credit for; the priority is amplifying those stories with retail partners to build a premium profile.

Q: Simeon Siegel (Guggenheim) asked for more detail on the confidence behind the stronger fourth quarter within the full-year guide. A: Taleghani said Q4 benefits from a couple of points of North America revenue from the youth transition, a few points from wholesale initiatives to reduce excess inventory, and about 5 points of EMEA improvement from distributor shipment timing timing that supports Q4 revenue without changing full-year demand assumptions. Stronger year-over-year profitability is expected on pricing, favorable channel and product mix, and expense discipline, partly offset by external cost pressures and inventory actions.

Q: Jay Sole (UBS) asked how the marketing plans are playing out in the market, including campaigns like the football push. A: Plank said marketing is measured by selling, and cited the consideration and brand perception gains as positive signals. He said the company is establishing one global brand voice, moving to a single major product launch per month, and significantly reducing performance marketing so traffic spend is replaced by spending on

For the complete transcript of the earnings call, please refer to the full earnings call transcript .