Why Under Armour is In Trouble

Under Armour In Deep Waters – Find Out Why

Under Armour stepped into the world of athletic gear and apparel with promising prospects becoming one of the best recent up-and-comers. However, as of late, the company seems to have met with some unknown and perplexing circumstances. On October 30th, UA reported a decline in sales and reduced its annual sales forecast for the second time in three months. The company’s shares recorded a staggering drop by 15%. This marked UA’s first quarterly sales drop since 2005 when the brand was first introduced to the public.

The brand’s struggle can be credited to primarily two factors: fewer sales in the USA, their strongest market, and better performance by its competitors in the industry.

Under Armour was a primary contributor to the streetwear trend. Now incredibly popular, there is no longer a sense of exclusivity and originality in UA’s products which might have contributed to the recent decrease in sales.

UA expressed its interest in spreading its wings and expanding into producing other sports-related gear such as fishing, tennis, and outdoor gear. The recent reports might force the company to implement that idea earlier than they had initially planned.

A brand known for its unique and risqué approach, Under Armour is not one to get intimidated by new challenges. In early October, the introduced the ArmourBox, a monthly subscription service that provides customers with new items. Since the program is still quite new, the success or decline rate will be difficult to deduce.

Perhaps the greatest contributing factor to this entire ordeal, however, has to be the brand’s inability to keep up with the reigning moguls in the world of sportswear that are Adidas and Nike. Adidas, in particular, has managed to snag the majority of the market share from both Nike and Under Armour raising its guidance in August and reported a 25% increased sales rate in the previous fiscal quarter.