Under Armour to Raise Prices Amid Tariff Pressures

Published 4 hours agoUA

Under Armour to Raise Prices Amid Tariff Pressures

Under Armour has announced its decision to increase prices as it confronts tariff challenges, despite reporting better-than-expected quarterly revenue results. The company saw an 11% decline in revenue, amounting to $1.18 billion, which was a smaller drop than the forecasted 12.4% decrease. Reuters noted that these results had a positive impact on the market, as Under Armour's shares rose by 2.4% in pre-market trading.

In addition to its revenue performance, Under Armour achieved a significant improvement in its gross margin. The margin rose by 170 basis points to reach 46.7%, driven by supply chain efficiencies and lower costs. The company's effort to curb costs and manage supply chain issues has evidently contributed positively to its financial health, allowing some buffer against the impending tariff issues.

Looking ahead, Under Armour plans to implement price increases to counteract the potential effects of a 46% tariff on Vietnamese exports to the U.S., set to take effect if no reduction is negotiated by July. The company is also projecting a 4% to 5% decline in current-quarter revenue, surpassing previous analyst expectations of a 1.9% drop. These strategic moves highlight Under Armour's ongoing adaptation to maintain profitability in a challenging economic landscape.

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