Tariff Impacts at Under Armour and Allbirds Rattle Shoe Investors
Some shoe investors are heading for the hills over worries connected to lowered earnings guidance from Under Armour, Allbirds and Crocs after the three posted earnings results this week.
Under Armour Inc.’s first quarter report on Friday sent shares down 17.2 percent in mid-afternoon trading, or $1.08, to $5.19, after company founder, president and CEO Kevin A. Plank said the expectation is an additional $100 million in added costs from tariffs, an amount that will make its turnaround efforts that much harder. The net loss was $3 million, on a 4 percent revenue decline to $1.1 billion. Footwear sales were down 14 percent to $266 million, while apparel sales decreased 1 percent to $747 million. Looking ahead to the second quarter, the company projected a revenue decline by 6 to 7 percent, and earnings per share between 1 cent and 2 cents, a drop from analyst expectations of 26 cents.
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Allbirds Inc., which posted second quarter results Thursday after the markets closed, plummeted 29.3 percent, or $2.87, to $6.94. The company managed to narrow its net loss to $15.5 million from the year-ago net loss of $19.1 million, but it also saw a revenue decline of 23.1 percent to $39.7 million from $51.6 million. It also lowered net revenue guidance for full year 2025 to between $165 million to $180 million. The prior guidance was $175 million to $195 million.
Other shoe firms also saw declines, such as Genesco Brands Inc., down 4.8 percent to $23.82; Amer Sports Inc., down 1.6 percent to $37.24; Caleres Inc., down 1.4 percent to $13.57; Wolverine Worldwide Inc., down 1.1 percent to $27.45; Steve Madden Ltd., down 0.8 percent to $25.44; Deckers Inc., down 0.2 percent to $101.68; Nike Inc., also down 0.2 percent to $74.18, and Skechers USA Inc., down 0.1 percent to $62.96.
Shoe retailers also saw declines. Shoe Carnival Inc. was down 4.8 percent to $19.57; Dick’s Sporting Goods Inc., down 1.9 percent to $210.61; Boot Barn Holdings Inc., down 1.6 percent to $166.00; Academy Sports + Outdoors Inc., down 1.1 percent to $49.63, and Designer Brands Inc., down 0.7 percent to $2.91.
There were a few exceptions. One was Swiss athletic shoe firm On Holding AG, which was up 0.5 percent to $45.40. Another shoe stock that rose was Crocs Inc.
Crocs fell 0.1 percent, or 10 cents, to $74.29 in mid-afternoon trading Friday, but ended the trading session up 0.7 percent to close at $74.92. But that was nowhere near where the closing stock price was on Thursday after it posted second quarter results. Crocs shares closed at $74.39, a significant decline from Wednesday’s closing price of $105.13.
Crocs bested Wall Streets’ expectations, with adjusted diluted earnings per share (EPS) of $4.23 and revenues up 3.4 percent to $1.15 billion. Analysts were expecting adjusted diluted EPS of $4.02 on revenue of $1.14 billion. But what left investors shell-shocked was third quarter guidance that pegged revenues to be down 9 percent to 11 percent. Crocs CEO Andrew Rees is eying “bold decisions” for sustainable growth and cash flow, including “social commerce and live streaming platforms,” such as TikTok Shop.
Plank told investors on the company conference call that the company is undertaking a “bold reinvention” of the brand.
“Our current numbers don’t yet tell the whole story, but the signs are there. Brand health is starting to gain traction. Cultural relevance is returning, and our phone is ringing from talent that wants to join us,” he told investors, adding that the company is stronger now than it was six months ago and will be even stronger six months from now.
Plank cited tighter assortments and more key items in stock to net better order fulfillment. He assured investors the company will continue to launch defining products, such as the Velociti Elite 3 running shoe, the Magnetico football boot and the Halo running collection. He said the company is premiumizing the brand to its “top 10 volume drivers across apparel footwear and accessories.”
He also acknowledge that its footwear business “is not where it should be,” adding that for too long the company “lacked focus and consistency in a category that defines our industry.”
The company two years ago eliminated underperforming shoe lines to rebuild its footwear foundation.
“Running footwear is a great example where we now have two very clear pinnacle vertical silos of product, Velociti and the recently launched Halo,” Plank said. “We’ve made the decision to sunset our previous Infinite franchise, which we believe is a long-term brand right decision, but it’s come at a price which you’re seeing affect our near-term footwear declines and replaced it with a broader aperture and more sports casual vertical of Halo, while doubling down on our Velociti franchise in high-performance run.”
Currently, Plank said softer demand is weighing on results, but over the mid- and long term, he said Velociti and Halo are expected to drive greater intention across its running category and provide “a blueprint for the broader footwear business.” He said that in American football, the Spotlight Pro Suede cleats sold out at launch, while in baseball the King of Diamonds and Juice Drops are driving momentum. And in basketball, Flow continues to “drive our iconic franchises.”
“What’s coming to life is a carefully sequenced strategy to reintroduce Allbirds, starting from our roots and building toward a clear reimagined future as a modern lifestyle footwear brand,” president, secretary and CEO Joe Vernachio said in a company conference call Thursday.
He said beginning this month and through the end of the year, the company will drop new products every month and introduce new marketing content each week. Vernachio acknowledged that the the current macro environment creates some uncertainty around consumer spending, but emphasized the company’s conviction in the work it has done to bring compelling product to the market.
Allbirds introduced in July an improved version of its best-selling style Tree Runner NZ, along with the new Cruiser that’s crafted from the firm’s signature eucalyptus-derived tree material. And this month, the Wool Runner NZ will be relaunched using merino wool.
For autumn, the company expects to launch its first-ever waterproof collection, followed in November the debut of the Kiwi collection, featuring a slipper, clog and low boot footwear for home and short trips around one’s neighborhood.
“This season, we’re introducing a broader range of new styles and materials than ever before, bringing depth, discovery and innovation across the line. We’re expanding into new textures and finishes like velvet, tweed and sculpted knit patterns with new drops expected to arrive every few weeks,” he said. “In total, we expect to launch 19 new styles this season, a major step forward from a year ago.”
The shoe firm is also partnering with Blumaka and Circ to launch Remix, Allbirds’ foray into circularity. Blumaka is the leader in foam upcycling and Circ is a pioneer in textile to textile recycling. The partnerships will enable Allbirds to utilize foam scraps and textile waste into comfortable shoes under its Runner and Cruiser platforms.
Also on the agenda for 2026 is a new material Allbirds is calling Terralux, which has leather-like aesthetics and performance created from plant proteins, biopolymers and recycled materials that otherwise would be put in landfills. And in the works for next year is a new upper mesh fabric from tree fiber but engineered for lightweight breathability called Aerie.
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