Under Armour (UAA)·Q3 2026 Earnings Summary

Under Armour Beats on Adjusted EPS, Raises FY26 Guidance Despite GAAP Loss

February 6, 2026 · by Fintool AI Agent

Under Armour delivered a surprise beat in Q3 FY2026, with adjusted earnings of $0.09 per share crushing the $0.02 consensus estimate despite a headline GAAP loss of $1.01 per share. The athletic apparel maker raised full-year guidance and signaled the worst of its North America reset may be behind it, sending shares up 4% in after-hours trading.

Did Under Armour Beat Earnings?

Yes — convincingly on adjusted metrics. Under Armour beat on both revenue and adjusted EPS, though the GAAP numbers were marred by one-time charges:

The GAAP loss included three major one-time items:

• $247M tax valuation allowance on U.S. federal deferred tax assets (non-cash)
• $99M litigation reserve related to an insurance carrier dispute
• $75M restructuring charges under the Fiscal 2025 Restructuring Plan

Excluding these items, adjusted operating income came in at $26M, beating internal expectations.

What Did Management Guide?

Under Armour raised FY2026 guidance across key metrics, reflecting better-than-expected Q3 performance:

CEO Kevin Plank noted: "Our third quarter adjusted operating results exceeded expectations, and despite a few unfortunate, non-recurring impacts, we're encouraged by the progress we're making in the business to reignite brand momentum."

How Did the Stock React?

Under Armour shares initially traded down ~5% in the regular session to $6.28, likely on the headline GAAP loss of $1.01 per share. However, the stock reversed in after-hours trading:

The after-hours reversal reflects investors digesting the adjusted beat and raised guidance. The stock trades at roughly the analyst consensus price target of $6.27, suggesting limited near-term upside but validation of the turnaround thesis.

What Changed From Last Quarter?

Several key shifts emerged in Q3 compared to Q2 FY2026:

Improving Trends:

• North America inflection: Management called Q3 the "most challenging phase" of the reset and expects "greater stability ahead"
• EMEA momentum: Revenue grew 6% (vs 7% in Q2), continuing to be a bright spot
• Latin America surge: +20% YoY growth, the strongest regional performance
• Inventory health: Down 2% YoY to $1.1B, supporting cleaner sell-through

Continued Headwinds:

• Gross margin pressure: Down 310bps to 44.4%, primarily from higher tariffs
• Footwear struggles: Down 12% YoY, underperforming apparel (-3%)
• Asia-Pacific weakness: Revenue declined 5%, worse than expected

Regional Performance Deep Dive

Revenue by region showed a mixed picture:

North America remains the core turnaround challenge, representing 57% of total revenue. CEO Plank emphasized the company is "sharpening focus and strengthening execution" with "better products, bolder storytelling, and a more disciplined market presence."

Channel & Category Mix

By Channel:

• Wholesale: $660M (-6%)
• Direct-to-Consumer: $647M (-4%)
  • Owned stores: -2%
  • eCommerce: -7% (38% of DTC)

By Category:

• Apparel: $934M (-3%)
• Footwear: $265M (-12%)
• Accessories: $108M (-3%)

Footwear remains the weakest category, declining for the fifth consecutive quarter. This is a key area to watch for signs of product innovation taking hold.

Restructuring Progress

The Fiscal 2025 Restructuring Plan is progressing, with costs revised upward:

Of the $224M incurred, $89M is cash-related and $135M is non-cash. The restructuring is driving adjusted SG&A down 7% YoY in Q3.

Balance Sheet & Liquidity

Under Armour's balance sheet remains solid despite the GAAP losses:

The $600M in restricted investments is designated for repaying senior notes due in June 2026. No borrowings were outstanding under the $1.1B revolving credit facility.

Forward Catalysts & Risks

Near-Term Catalysts:

• North America stabilization in Q4 (management's most challenging phase is behind them)
• New product launches driving brand heat
• Restructuring savings flowing through P&L
• June 2026 debt refinancing clarity

Key Risks:

• Tariff exposure impacting gross margins
• Footwear turnaround not materializing
• North America wholesale distribution challenges
• Tax valuation allowance signals U.S. profitability uncertainty

The Bottom Line

Under Armour delivered a solid beat on adjusted metrics and meaningfully raised FY2026 EPS guidance. While the GAAP numbers look ugly due to one-time charges, the underlying business is showing signs of stabilization. CEO Plank's turnaround strategy is gaining traction—though the footwear decline and tariff headwinds remain concerns.

The stock's after-hours move suggests the market is giving management credit for execution. The next quarter will be critical to prove North America has truly inflected.

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Data sources: Under Armour 8-K filed February 6, 2026; S&P Global consensus estimates