Under Armour Shares Fall 12% After Q3 Guidance Miss and Raised Middle East Hit

Under Armour reported fiscal second-quarter 2027 results on November 6, 2026 that narrowly beat revenue and earnings estimates but sent shares tumbling roughly 12% after the company cut its gross margin outlook and raised its estimate of losses tied to the Middle East conflict. Revenue came in at $1.24 billion, just above the $1.23 billion consensus but down 7% year over year, while adjusted EPS of $0.00 edged past the expected loss of $0.01. Adjusted operating income reached $24.9 million and adjusted gross margin was 47.0%, down 30 basis points from a year earlier.

The sharper market reaction came from forward guidance. For the third quarter, Under Armour projected adjusted EPS of -$0.03 to -$0.01, well below the $0.05 consensus, with adjusted operating income ranging from -$5 million to $5 million. The company also trimmed its full-year gross margin expansion forecast to 170-220 basis points from a prior 220-270 basis points, and separately raised its estimate of the Middle East conflict's operating income impact to $45 million from $35 million previously.

Full-year FY2027 guidance calls for a mid-single-digit revenue decline, adjusted EPS of $0.08 to $0.12 against an $0.11 consensus estimate, and adjusted operating income of $140 million to $160 million. Regional revenue declines were broad: North America fell 6.9% to $737.2 million, EMEA dropped 8.5% to $290.6 million, and Asia-Pacific slid 8.8% to $163.5 million, with Latin America the lone bright spot at $55.4 million, up 3.0%. The company recorded $13 million in restructuring charges during the quarter, including $11 million in direct charges and $2 million in transformation-related SG&A, as it continues a broader business transformation aimed at sharpening its product focus and improving margins.