Abstract
Under Armour Class A will release fiscal Q3 2026 results on February 06, 2026 Pre-Market; this preview synthesizes last quarter’s actuals, current-quarter forecasts for revenue, margins, net profit, and EPS, and aggregates institutional sentiment from recent research and news since August 01, 2025.
Market Forecast
Consensus for the fiscal quarter to be reported points to revenue of USD 1.31 billion, an adjusted EPS of USD -0.02, and EBIT of USD 0.01 billion, implying a year-over-year revenue decline of 2.09% and a sharply weaker EPS trajectory; margin commentary from forecasts implies pressure persisting into this quarter, though specific gross margin and net margin forecasts were not numerically disclosed. Based on the company’s segmentation, apparel remains the core revenue engine while footwear and accessories contribute smaller shares; the near-term outlook emphasizes disciplined inventory and promotional control, with the greatest incremental potential tied to product resets within footwear, albeit off a smaller base and with year-over-year declines expected.
Last Quarter Review
In the prior reported quarter, Under Armour Class A delivered revenue of USD 1.33 billion, a gross profit margin of 47.29%, GAAP net profit attributable to shareholders of USD -18.81 million, a net profit margin of -1.41%, and adjusted EPS of USD 0.04, with year-over-year dynamics reflecting revenue down 4.69% and EPS down 86.67%. A notable financial highlight was the company’s EBIT of USD 0.05 billion, which exceeded estimates despite soft top-line performance and negative GAAP profitability. By main business, apparel generated USD 936.48 million, footwear USD 263.63 million, accessories USD 113.08 million, and licensing USD 28.98 million; apparel remained the largest contributor, while reported commentary around YoY suggests ongoing softness across categories, with higher gross margin cushioning profitability.
Current Quarter Outlook
Core Apparel Performance and Margin Discipline
Apparel is the primary driver of Under Armour Class A’s sales base, contributing roughly seventy percent of last quarter’s revenue at USD 936.48 million. For the current quarter, revenue is forecast to decline modestly year-over-year to USD 1.31 billion with adjusted EPS of USD -0.02, indicating that even solid product acceptance or disciplined promotions may not fully offset demand and mix headwinds. Apparel trends hinge on balancing price discipline with competitiveness against broader marketplace discounting, where promotional cadence has been a tool to control inventory yet has risked compressing contribution if traffic slows. The prior quarter’s gross profit margin of 47.29% shows the organization’s ability to manage input costs, mix, and pricing despite the top-line contraction; however, achieving a similar or improved gross margin this quarter will require tight management of promotions, continued freight and product cost benefits, and a careful product mix pivot toward higher-margin performance apparel offerings. The net profit margin of -1.41% last quarter, alongside an adjusted EPS that topped forecasts, highlights that operating expense controls are meaningful yet not sufficient to overcome volume leverage headwinds; investors will focus on whether operating expense run-rate and restructuring initiatives can steady margins if revenue remains below prior-year levels.
Footwear Reset and Potential Rebound Path
Footwear delivered USD 263.63 million last quarter and is commonly cited by the market as the largest incremental growth opportunity over the medium term, given brand headroom and product refresh cycles. Short-term, the forecast still embeds caution, and recent institutional commentary characterizes the near-term trajectory as mixed, reflecting channel inventories, competitive launches, and brand heat dynamics in running, training, and basketball. The company’s announced structural moves around its basketball franchise and related brand initiatives target better long-term clarity in positioning and assortment, while management’s operational focus suggests that innovation cadence and targeted marketing will be essential to rebuild velocity. Near-term progress is likely to be measured, but footwear’s smaller base versus apparel means that even modest wins in marquee franchises or improved sell-through could contribute a visible revenue and margin tailwind in subsequent quarters once the category’s reset and inventory normalization mature.
Stock Price Drivers: Restructuring Execution, Promotions vs. Brand Health, and EBIT/EPS Sensitivity
Near-term stock performance will be sensitive to how the company executes cost and restructuring plans while maintaining brand equity through calibrated promotions. The market will parse whether EBIT and adjusted EPS land near forecasts—USD 0.01 billion and USD -0.02, respectively—and whether management narrows the full-year trajectory with credible visibility on gross margin puts and takes, including freight relief, product costs, and mix. Updates on the transformation plan timing and milestones, especially regarding category simplification and operating efficiencies, will be critical to investor confidence; a path to stabilize revenue with sustained gross margin in the mid-to-high 40% range could support a gradual operating margin rebuild. Conversely, any indication of heavier-than-planned markdowns or additional restructuring charges would likely prompt downward revisions to near-term profitability expectations, keeping the shares range-bound until evidence of improved sell-through and expense leverage becomes clearer.
Analyst Opinions
Across recent publications and headlines during the period since August 01, 2025, institutional sentiment appears mixed-to-cautious, with a tilt toward neutral-to-hold positions rather than outright bullish calls. Notable views include multi-firm Hold ratings pointing to uneven performance and uncertain near-term visibility, while at least one Buy stance highlights the potential from strategic repositioning and cost discipline if execution improves. In the aggregate, neutral and cautious tones outnumber constructive ones, reflecting concerns about continued revenue declines, category resets, and the scope and timing of restructuring benefits. The prevailing majority opinion therefore leans cautious: analysts anticipate pressure on this quarter’s revenue and EPS, monitor the company’s ability to protect gross margin, and look for evidence that product refreshes and operating changes can re-accelerate growth. Within this consensus, the most consistent themes are controlled promotions to protect margins, the need for sustained product innovation and brand heat in footwear, and the importance of expense and inventory discipline to underpin any earnings stabilization through fiscal 2026.Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.
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