Under Armour to Lay off 600; Expands Restructuring
Approximately 600 Under Armour corporate employees, some 11.8 percent of its 5,100 strong corporate workforce as of Dec. 31, 2019, are losing their jobs at the Baltimore-based company. The job cuts, expected to cost Under Armour $30 million in employee severance and benefit costs, are part a widened restructuring that will results in $40-60 million in pre-tax benefits for the company this fiscal year.
Under Armour’s total restructuring, now forecast to cost $550-600 million on a pre-tax basis, also includes $135 million for contract terminations and a $291 million impairment that was taken earlier this year that is related to its New York City flagship store. The company release details in a public filing yesterday.
During its most recent earnings call in late July, Under Armour senior executives voiced eagerness to move ahead with a brand reset strategy focused on “digital first” and “premium (selling) environment” planks. The company confirmed the off-price distribution channel would account for a “mid-single digit” percentage of its FY20 global sales.
North American revenues slipped 45 percent to $450 million in the period ended June 30 as global footwear sales declined 35 percent to $185 million.