Under Armour announced on Tuesday that it will raise prices on select products to offset the potential impact of forthcoming U.S. tariffs. This move follows a quarterly earnings report that beat revenue expectations, suggesting the brand’s recent restructuring efforts are beginning to show results.
The athleticwear giant has been strategically steering away from deep discounting and has cut back on inventory, promotions, and staffing in a bid to revive sales. The company’s turnaround has focused heavily on full-price sales and a more curated product assortment, helping stabilize its financial performance after two challenging years.
On a post-earnings call, Chief Financial Officer David Bergman said Under Armour is now preparing to implement targeted price hikes while also seeking to shift more of its sourcing to countries with lower tariff exposure. Currently, around 30% of its products come from Vietnam, 20% from Jordan, and 15% from Indonesia—nations that may soon face steeper trade levies under the Trump administration’s revised tariff structure.
Should tariffs of 46% on Vietnamese imports and 32% on goods from Indonesia take effect in July, Under Armour’s profit margins could come under pressure unless trade negotiations lead to more favorable terms. Despite this looming risk, the company saw its gross margins rise by 170 basis points to 46.7% in the fourth quarter, thanks in part to better inventory management and new, trend-forward product launches.
Analysts remain cautiously optimistic. EMarketer’s Sky Canaves noted that while Under Armour’s long-term shift away from lower-margin sales is gaining traction, meaningful financial gains may not materialize until later in the year. The company itself forecasts a 4% to 5% revenue dip in the first quarter, more than double what analysts had anticipated.
In the most recent quarter ending March 31, Under Armour posted an 11% revenue decline to $1.18 billion, slightly better than the expected 12.4% drop. Despite the positive surprise, the company’s stock showed minimal movement in volatile trading, reflecting investor wariness as global trade tensions continue to evolve.