Key Takeaways

• Under Armour posted better-than-anticipated profit and sales, and gave credit its effort to turn around the company.

• The athletic apparel maker increased its gross margin and slashed expenses, and boosted its guidance.

• Founder and CEO Kevin Plank said the turnaround plan is "gaining traction."

Under Armour (UA, UAA) shares skyrocketed as the athletic apparel maker’s better-than-expected results and increased guidance indicated that CEO Kevin Plank's turnaround plan is working.

The company posted fiscal 2025 second-quarter adjusted earnings per share (EPS) of $0.30, with revenue falling 10.7% to $1.4 billion. Both numbers exceeded forecasts.

The company now sees full-year adjusted EPS of $0.24 to $0.27, up from its previous outlook of $0.19 to $0.21. It anticipates gross margin will gain 125 to 150 basis points, compared to its previous estimate of a 75- to 100-basis-point rise. (A basis point is a hundredth of a percentage point.)

Shares of Under Armour, recently up nearly 30% after backing off intraday highs, were at some of their highest levels since early 2023.

Under Armour said its gross margin was 200 basis points (bps) higher, to near 50%, during the quarter, citing “lower product and freight costs, reduced discounting levels in the direct-to-consumer business, and a favorable channel mix.” The company also slashed selling, general & administrative (SG&A) costs 13% to $530 million.

Plank, the company founder who stepped down in 2019 and then returned in April, said the performance “demonstrates that our strategy to reconstitute the Under Armour brand and establish a more premium position in the marketplace is gaining traction.".