Reorganization is imminent, but Under Armour is still "searching for the bottom."

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The restructuring plan is counting down, but Under Armour's growth engine has yet to fully restart.

For the second quarter of fiscal year 2026 ending September 30, Under Armour recorded revenue of $1.3 billion, a 5% year-on-year decrease.

Due to tariff pressures and supply chain fluctuations, gross margin fell by 250 basis points year-on-year to 47.3%; net loss reached $19 million, with an adjusted net profit of $15 million.

In the core North American market, revenue fell 8% year-on-year to $790 million, mainly due to a contraction in full-price wholesale business and weak e-commerce sales.

Currently, Under Armour is actively promoting the recovery of North American wholesale channels.

Under Armour said that through ongoing negotiations with core partners, it has begun formulating a multi-year plan aimed at stabilizing the business in fiscal year 2027 to lay the foundation for subsequent growth.

Meanwhile, revenue for the Asia-Pacific region—which includes the Chinese market—was $179 million, a 14% year-on-year decline.

However, management pointed out that this data does not fully reflect the actual improvement in the Asia-Pacific market, as structural adjustments are gradually taking effect.

Starting in the fourth quarter, Under Armour will trial a new digital retail store concept to create deeply immersive consumer experiences.

"Consumers have not lost hope in or rejected Under Armour—they have just temporarily forgotten about us," emphasized Under Armour President and CEO Kevin Plank at the earnings conference.

Kevin Plank also stated that with the advancement of brand campaigns such as "We Are Football," Under Armour's brand awareness among the 18- to 34-year-old age group has surged from about 60% six months ago to over 80% now.

Looking ahead to fiscal year 2026, Under Armour expects full-year revenue to fall 4% to 5% year-on-year, narrowing from the 9% decline in fiscal year 2025.

High single-digit declines are expected in both North America and the Asia-Pacific, while Europe, the Middle East, and Africa (EMEA) regions are expected to achieve high single-digit growth.

Management emphasized that the current top priority is stabilizing the business fundamentals and clearly mapping out the path for sustainable growth in fiscal year 2027 and beyond.

In the future, Under Armour will look to continuously reduce inventory levels through stricter procurement controls, accelerated in-season decision efficiency, reinforced procurement discipline, and more precise market operations, while also maintaining price and profit margins.

Under Armour's previously launched 18-month restructuring plan is nearing completion.

The plan started in June 2024, when founder Kevin Plank returned to the company to lead the initiative. The expected restructuring cost is between $70 million and $90 million.

As of September 30 this year, the plan has already resulted in $103 million in restructuring and impairment costs, as well as $44 million in other transformation-related expenses.

The core strategy of the restructuring covers multi-dimensional business adjustments: tightening promotional mechanisms to increase per customer transaction and overall profitability; focusing on the core menswear business; and rebooting Flow technology to relaunch Curry series basketball shoes, among others.

Currently, Under Armour is placing strategic priority on the Asia-Pacific market, especially China, which accounts for nearly half of the region's revenue.

This year, there has been a flurry of activity in the China market. In June, Under Armour signed on to become the equipment partner for both the Chinese national flag football team and the men's national rugby sevens team, providing professional technical support.

In August, the 2025 CURRY brand Asia Tour landed in Chongqing, launching for the first time in Asia the "CURRY CON" sports gathering and "CURRY CAMP" training camp, two major brand IPs.

In November, an important appointment was announced: Carol Chen will serve as Vice President and General Manager of Greater China, fully responsible for the strategic and business operations in the Chinese market.

She previously served as Vice President of Sales for Nike Greater China and as Vice President and General Manager for Converse Asia.

However, among these developments, the one most watched by the market is the rapid launch of "Under Armour Explor," the brand's outdoor line.

This brand is a collaboration between Under Armour and its Chinese distributor, "Youlv Outdoor Products (Shanghai) Co., Ltd." Under Armour licenses its trademark to the partner, who then enjoys significant autonomy in product development, store expansion, and channel management.

Thus far, Under Armour Explor has entered 22 provinces and municipalities across China, and in September opened its first flagship store in Shanghai Xintiandi.

Traditionally, Under Armour has focused on basketball, football, and athletic training. Now, by entering the booming outdoor market through "Under Armour Explor," whether this strategic pivot can truly create a breakthrough remains to be tested by the market.

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