Under Armour Stock Plunges 13% After Margin Forecast Cut and Raised Middle East Cost Hit

Under Armour reported fiscal second-quarter 2027 results on November 6, 2026 that narrowly topped estimates but sent shares tumbling roughly 12% to 13% as the company slashed its gross margin growth 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 negative $0.03 to negative $0.01, well below the $0.05 consensus, with adjusted operating income ranging from negative $5 million to $5 million. The company also cut its full-year gross margin expansion forecast to 170 to 220 basis points from a prior range of 220 to 270 basis points, citing higher external costs and planned inventory actions. The estimated operating income hit from the Middle East conflict was raised to $45 million from a previous estimate of $35 million.

For the full fiscal year 2027, Under Armour maintained its adjusted EPS guidance at $0.08 to $0.12 against a consensus of $0.11, and kept its revenue outlook at a mid-single-digit decline. Adjusted operating income is expected to land between $140 million and $160 million. Regional revenue declines were broad, with North America falling 6.9% to $737.2 million, EMEA down 8.5% to $290.6 million, and Asia-Pacific off 8.8% to $163.5 million, while Latin America was the lone bright spot at $55.4 million, up 3.0%. The quarter included $13 million recorded under the company's restructuring plan, comprising $11 million in restructuring charges and $2 million in transformation SG&A expenses.