Under Armour, Inc. Q2 FY2026 earnings call

Management Statement and Operational Highlights:

• Leadership Transition: Dave Bergman’s departure after 21 years, with Reza Taleghani joining as EVP and CFO in Feb 2026.
• Product Strategy: Streamlined 25% of SKUs, new design language in training, running, and sportswear; innovation in apparel (HeatGear, ColdGear, etc.), footwear (Velociti Elite 3, etc.), and accessories (StealthForm hat, No Weigh backpack).
• Regional Performance: EMEA showing healthy profitable growth; APAC rebuilding to growth; North America increasing brand heat with improved storytelling and product momentum.
• Storytelling: Enhanced cultural edge through campaigns like 'We Are Football', driving awareness among 18-34-year-olds.
• Operational Updates: DTC balancing pricing and shopping experience; wholesale undergoing disciplined rebuild with positive momentum in key accounts.

Segment Performance:

• Apparel: Revenue declined 1%, with softness in run, outdoor, and golf, partially offset by growth in train and sportswear.
• Footwear: Revenue declined 16%, reflecting challenging consumer demand and efforts to recalibrate the portfolio.
• Accessories: Revenue declined 3%, with decreases across most categories, partially offset by growth in sportswear, especially headwear.
• Regional: North America revenue decreased 8%; EMEA increased 12% (7% currency-neutral); APAC declined 14%; Latin America increased 15% (14% currency-neutral).

Guidance:

• Full-year revenue expected to decline 4%-5% in fiscal '26, better than fiscal '25's 9% decline.
• Gross margin expected to decline 190-210 basis points due to higher U.S. tariffs, offset by foreign currency, product mix, and pricing.
• Adjusted operating income expected $90M-$105M; adjusted diluted EPS $0.03-$0.05.
• Q3 revenue expected to decline 6%-7%, with North America down, EMEA up, APAC down.

Risks:

• Supply chain headwinds, including higher U.S. tariffs impacting gross margin.
• Promotional market conditions affecting DTC and wholesale performance.
• Regional mix challenges, including unfavorable mix impacting profitability.

Question and Answer: Q: Jay Sole asks about North America stabilization and NEOLAST.

A: Kevin Plank responds on North America stabilization factors (right team, product elevation, storytelling, partner belief, cultural energy) and details NEOLAST as a sustainable fiber replacing Lycra.

Q: Sam Poser inquires about track and field marketing voice and North America sell-throughs.

A: Kevin Plank discusses leveraging track and field with partnerships and positive sell-throughs at retail.

Q: Bob Drbul asks about sports marketing portfolio and footwear changes.

A: Kevin Plank talks about dynamic sports marketing and footwear strategy focusing on cleated, training, and running categories.

Q: Laurent Vasilescu asks about pricing elasticity and tariff impact.

A: David Bergman addresses strategic pricing, tariff mitigation, and Q3/Q4 tariff impacts.

Q: Peter McGoldrick inquires about guidance progression and pricing balance.

A: David Bergman explains guidance progression due to shipment shifts and pricing balance across product portfolio.

Q: Brooke Roach asks about APAC business trends.

A: Kevin Plank discusses APAC's story issue and plans for stabilization with new store concepts.

Q: Kelly Crago follows up on North America wholesale sell-through and order books.

A: Kevin Plank and David Bergman discuss improved sell-throughs, stable order books, and potential upside in holiday quarter.