Under Armour Is Shrinking on Purpose and That’s the Point

Under Armour is doing something most global consumer brands are terrified to do: it’s choosing to sell less today so it can matter more tomorrow.

Over the past 18 months, Under Armour has entered a deliberate, multi-year reset, pulling back on promotions, tightening distribution, splitting with Steph Curry, cutting SKUs, and re-architecting its product range, fully aware that the near-term consequence would be falling revenues. This is not a demand shock. It’s a strategic choice.

The numbers make that clear. In FY2025, Under Armour reported net revenues of $5.16bn, down year-on-year, even as gross margin climbed to 47.9%. Fewer discounts, lower freight costs, and cleaner product economics improved profitability per unit but at the cost of volume, particularly in North America and Asia-Pacific. On paper, the year ended in a GAAP loss, distorted by restructuring charges and non-recurring clean-up items tied to a company actively dismantling complexity.

That same tension carried into the most recent quarter. In Q3 FY2026, revenue fell another 5% to $1.33bn, while gross margin compressed sharply amid tariffs and pricing pressure. Add in a $99m litigation reserve and a $247m non-cash tax valuation allowance, and the headline result looks ugly. But look past the accounting noise and a clearer signal emerges: Under Armour is still paying the price for its reset and hasn’t yet reached the payoff phase.

This matters for partners, not just investors.

For 365247 Sports, Under Armour is not a “discount-led volume engine” in waiting. It is a global sports brand in rebuild mode, explicitly prioritising pricing power, brand posture, and sport-authenticity over chasing short-term sales. That makes it most attractive and can win the reset through premium storytelling, disciplined distribution, and credible sport-led activation rather than pushing reach at any cost.

And the opportunity is real. Under Armour retains global scale, operating across 150 countries with 2,000 mono-branded stores, and is actively re-asserting itself as a modern “sports house” outfitting athletes head-to-toe across multiple disciplines. The question is not whether the reset is happening. It’s where the whitespace sits, who benefits from it, and which partners are aligned with the direction of travel rather than the past.

365247 Sports went into the earning calls of Under Armour from Q1 2025 through to Q3 2026 to present this deep-dive into the business of Under Armour….

Let’s dig in!