Executive Summary
Under Armour reported results for QQ2 2025 showing a modest top-line contraction year-over-year amid a competitive consumer environment, but with profitability metrics demonstrating resilience. Revenue of $1.399 billion declined 10.7% YoY, while gross margin held near 50% at 49.8%, supported by favorable product mix and pricing discipline. Operating income rose to $173.1 million, driving a solid operating margin of approximately 12.37%, and net income swung higher to $170.4 million with diluted EPS of $0.39, up about 62.7% YoY. Notwithstanding strong profitability, the company burned cash in the quarter, with operating cash flow of -$321.4 million and free cash flow of -$367.2 million, driven largely by a substantial negative swing in working capital movements (-$505.3 million). At quarter-end, UA held $530.7 million in cash, with total debt of $1.332 billion and net debt of $801.1 million, yielding a liquidity profile that is solid but requires ongoing working-capital discipline to move FCF positive in a challenging macro backdrop. The figures suggest a turnaround in profitability, offset by cash-burn dynamics and leverage risk that investors should monitor amid a competitive footwear and apparel arena.
Key Performance Indicators
QoQ: 18.19% | YoY:-10.70%
QoQ: 157.75% | YoY:24.10%
QoQ: 155.79% | YoY:62.72%
QoQ: 155.71% | YoY:56.00%
Key Insights
Revenue: QQ2 2025 $1.399B; YoY -10.70%; QoQ +18.19%. Gross Profit: $696.1M; Gross Margin 49.76% (YoY -7.00%; QoQ +23.72%). Operating Income: $173.1M; Operating Margin 12.37% (YoY +24.10%; QoQ +157.75%). Net Income: $170.4M; Net Margin 12.18% (YoY +62.72%; QoQ +155.79%). EPS: $0.39 (YoY +56.00%; QoQ +155.71%). Cash Flow: Operating cash flow -$321.4M; Capex -$45.8M; Free Cash Flow -$367.2M. Balance Sheet: Cash $530.7M; Total Debt $1.332B; Net Debt $801.1M; Total Assets $4.495B; Total Equity $1.986...
Financial Highlights
Revenue: QQ2 2025 $1.399B; YoY -10.70%; QoQ +18.19%. Gross Profit: $696.1M; Gross Margin 49.76% (YoY -7.00%; QoQ +23.72%). Operating Income: $173.1M; Operating Margin 12.37% (YoY +24.10%; QoQ +157.75%). Net Income: $170.4M; Net Margin 12.18% (YoY +62.72%; QoQ +155.79%). EPS: $0.39 (YoY +56.00%; QoQ +155.71%). Cash Flow: Operating cash flow -$321.4M; Capex -$45.8M; Free Cash Flow -$367.2M. Balance Sheet: Cash $530.7M; Total Debt $1.332B; Net Debt $801.1M; Total Assets $4.495B; Total Equity $1.986B. Liquidity metrics: Current Ratio 2.18; Quick Ratio 1.24; Cash Ratio 0.45. Efficiency: Asset Turnover 0.311; Gross Margin 49.8%; Operating Margin 12.37%. Leverage: Debt/Total Capitalization 0.402; Debt/Equity 0.671.
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
1.40B |
-10.70% |
18.19% |
| Gross Profit |
696.13M |
-7.00% |
23.72% |
| Operating Income |
173.08M |
24.10% |
157.75% |
| Net Income |
170.38M |
62.72% |
155.79% |
| EPS |
0.39 |
56.00% |
155.71% |
Key Financial Ratios
operatingProfitMargin
12.4%
operatingCashFlowPerShare
$-0.74
freeCashFlowPerShare
$-0.85
Management Commentary
Transcript data for QQ2 2025 is not provided in the input. No management quotes or call highlights are available from the supplied dataset. If a transcript is supplied, this section would group key themes (strategy, operations, market conditions) and provide context and significance for each quote.
Forward Guidance
No explicit forward guidance was issued in the QQ2 2025 release. Given the quarter’s profit resilience alongside a material cash flow deficit, management is likely focused on: (1) accelerating direct-to-consumer (DTC) growth to improve gross margin mix and reduce wholesale exposure, (2) inventory normalization and working-capital efficiency to drive positive free cash flow, (3) ongoing cost discipline and SG&A optimization to sustain margins, (4) product innovation and brand partnerships to sustain demand in a competitive environment, and (5) deleveraging efforts or capital allocation that balances shareholder returns with balance sheet flexibility. Investors should monitor: DTC penetration and online conversion rates, inventory levels and days of inventory outstanding, gross margin trajectory by product category, working capital movements, capex intensity, and any changes in debt levels or financing terms. The achievability of improving FCF will hinge on demand stabilization, successful channel mix optimization, and timing of product cycles.