Under Armour (NYSE: UA) is a renowned sportswear company that designs and sells performance apparel, footwear, and accessories. Despite its strong brand presence, Under Armour faces stiff competition from industry giants like Nike and Adidas. On August 8, 2025, Under Armour reported earnings per share (EPS) of $0.02, missing the estimated $0.03. The company also reported revenue of approximately $1.13 billion, falling short of the anticipated $1.36 billion.
Following the earnings report, Under Armour's share price dropped over 18%, as highlighted by Reuters. The company's guidance for the second quarter further dampened investor sentiment, with expectations of a 6% to 7% revenue decline and a reduction in gross margins by 340 to 360 basis points. These challenges are largely due to anticipated supply chain issues stemming from tariffs.
In the first quarter, Under Armour's revenue decreased by 4% to $1.1 billion, aligning with Wall Street's expectations. North American revenue fell by 5% to $670 million, while international revenue saw a slight decline of 1% to $467 million. The company's adjusted EPS was $0.02, missing the forecasted $0.03. Despite these challenges, CEO Kevin Plank expressed satisfaction with the results, emphasizing the company's ongoing transformation.
Looking ahead, Under Armour projects second-quarter adjusted EPS to be between $0.01 and $0.02, significantly lower than the consensus estimate of $0.26. The company anticipates subdued demand in North America due to persistent high inflation and tariff uncertainties. As a result, Under Armour's shares dropped by 14% in premarket trading, as reported by Reuters.
Under Armour's financial metrics reveal some concerns. The company has a price-to-sales ratio is 0.41, suggesting investors pay $0.41 for every dollar of sales. The enterprise value to sales ratio is 0.51, while the enterprise value to operating cash flow ratio is notably high at 732.32, indicating potential cash flow concerns. Despite these challenges, Under Armour maintains a moderate debt-to-equity ratio of 0.66 and a strong current ratio of 2.01, indicating its ability to cover short-term liabilities.
