Executive Summary
Under Armour’s Q4 2024 results reflect a transitional quarter within a broader strategic reset as the company pivots toward a premium, launch-driven brand model. Revenue for the quarter was $1.332B, up 1.15% year over year but down 10.36% quarter over quarter, with gross margin at 45.0% and GAAP operating loss of $6.5M. The year ended 2024 with revenue of $5.7B, a 3% decline year over year, while gross margin expanded 130 bps to 46.1% on supply-chain benefits and favorable channel mix, though SG&A rose 1% to $2.4B. Management signaled a multi-year brand-reconstitution plan anchored in product quality, storytelling, and an optimized operating model, aimed at restoring growth and improving profitability over the medium term. In the near term, the company warned of a significant revenue reset in fiscal 2025, including a low-double-digit revenue decline driven by a 15-17% anticipated drop in North America, selective reductions in wholesale orders, and deliberate moderation of discounting in Direct-to-Consumer (DTC). Management projects gross margin improvement of 75-100 bps as promotional activity declines and cost initiatives take hold, with SG&A expected to decline 2-4% as the company restructures. A $70-90M pretax restructuring burden is planned, and a new three-year $500M share-buyback program was approved. The leadership team is undergoing a broad refresh (including a CMO search) to accelerate a faster go-to-market cadence (6-12 months) and a SKU reduction of roughly 25% over the next 18 months, with a sharper focus on men’s apparel and core performance categories. While the near-term revenue trajectory is negative, the strategy centers on returning UA to a premium, growth-facing position and differentiated storytelling around product performance, which should translate into improved brand affinity and margin expansion over time.
Key Performance Indicators
QoQ: -10.63% | YoY:-1.99%
QoQ: -109.04% | YoY:-128.80%
QoQ: -100.24% | YoY:-102.64%
QoQ: -100.23% | YoY:-103.00%
Key Insights
Revenue (Q4 2024): $1.332B, YoY +1.15%; QoQ -10.36%. Gross profit: $599.3M; gross margin 45.0% (vs. prior). Operating income: -$6.5M; EBIT margin -0.48%. Net income: -$0.264M; diluted EPS: -$0.60. Full-year 2024 revenue: $5.7B; YoY -3%. Full-year gross margin: 46.1%; SG&A: $2.4B; Operating income: $230M; Diluted EPS: $0.52 (GAAP) / $0.54 (adjusted). Cash and equivalents: ~$859M; Total debt: $1.442B; Net debt: $584.1M. Inventory: $958M (-19% YoY). Current ratio: 2.46; Quick ratio: 1.64; Free ...
Financial Highlights
Revenue (Q4 2024): $1.332B, YoY +1.15%; QoQ -10.36%. Gross profit: $599.3M; gross margin 45.0% (vs. prior). Operating income: -$6.5M; EBIT margin -0.48%. Net income: -$0.264M; diluted EPS: -$0.60. Full-year 2024 revenue: $5.7B; YoY -3%. Full-year gross margin: 46.1%; SG&A: $2.4B; Operating income: $230M; Diluted EPS: $0.52 (GAAP) / $0.54 (adjusted). Cash and equivalents: ~$859M; Total debt: $1.442B; Net debt: $584.1M. Inventory: $958M (-19% YoY). Current ratio: 2.46; Quick ratio: 1.64; Free cash flow (FY2024): -$156.7M (negative), Operating cash flow: -$139.1M.
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
1.33B |
1.15% |
-10.36% |
| Gross Profit |
599.34M |
-1.99% |
-10.63% |
| Operating Income |
-6.46M |
-128.80% |
-109.04% |
| Net Income |
-264.00K |
-102.64% |
-100.24% |
| EPS |
0.00 |
-103.00% |
-100.23% |
Key Financial Ratios
operatingProfitMargin
-0.49%
operatingCashFlowPerShare
$-0.32
freeCashFlowPerShare
$-0.36
priceEarningsRatio
-3015.68
Management Commentary
- Strategy and leadership: Kevin Plank reaffirms brand-reconstitution with an 18-month plan to tighten focus on product, storytelling, and cost discipline; leadership overhaul to sharpen execution, including a new Chief Product Officer and a forthcoming CMO. Quote: “We will reconstitute Under Armour’s brand strength over the next 18 months by focusing on brand building fundamentals, like making great products, telling the best story about those products, and servicing every aspect of delivering our business while building the best team.”
- 2025 revenue reset and margin target: Expect a low-double-digit revenue decline in FY2025, with NA down 15-17% and DTC/wholesale rationalizations; gross margin uplift of 75-100 bps anticipated from reduced promotions and cost actions. Quote: “before driving forward we'll be taking a larger step back in fiscal 2025 with an expectation that our revenue will be down at a low double digit rate. This includes an approximate 15% to 17% decline in North America.”
- Operational efficiency and SKU discipline: 25% SKU reduction over 18 months; faster GTM cycles (6-12 months) demonstrated with StealthForm Uncrushable Hat; tighter go-to-market and reduced agency footprint; quote: “refine our product assortment and reduce our SKU or style count by roughly 25% over the next 18 months.”
- North America focus and international nuance: NA supports a premium strategy via controlled promotions and elevated shopping experience; international remains a growth priority but with caution given channel inventory and macro softness; quote: “In North America, United States, that means our presence in American football, soccer, baseball, softball, volleyball, lacrosse, as a core sports we will speak to and solve problems for with our amazing performance innovation.”
We will reconstitute Under Armour’s brand strength over the next 18 months by focusing on brand building fundamentals, like making great products, telling the best story about those products, and servicing every aspect of delivering our business while building the best team.
— Kevin A. Plank
Before driving forward we'll be taking a larger step back in fiscal 2025 with an expectation that our revenue will be down at a low double digit rate. This includes an approximate 15% to 17% decline in North America.
— Kevin A. Plank
Forward Guidance
- FY2025 revenue trajectory: Low-double-digit decline; NA exposure down 15-17%; international down low single digits; wholesale down low double digits; DTC down around 10% due to reduced promotions.
- Margin and cost: Gross margin expansion of 75-100 bps anticipated through cost-structure improvements, lower discounting, and better product mix; initial Q1 FY2025 gross margin expected to be down 20-30 bps due to prior-year supply-chain benefits timing and FX headwinds, with improvement anticipated later in the year.
- Costs and capital allocation: Pre-tax restructuring charges of $70-90M; capex guidance $200-220M; SG&A optimization to persist; new $500M buyback program; additional details to be provided on Q1 call in August.
- Key milestones investors should monitor: (1) progress on SKU reduction and faster GTM cycles, (2) early signs of DTC premiumization (UA Rewards integration, exclusive product drops), (3) improvement in gross margin discipline and inventory management, (4) progress in North American wholesale relationships and the Fall/Winter 2025 product cycle, (5) achievement of sustainability of SG&A reductions and the pace of restructuring benefits.