Under Armour (NYSE: UAA) is trying hard to sell a new story

Under Armour (NYSE: UAA) sees itself as one of the top sportswear companies in the world, but it’s increasingly becoming known for the missed opportunities that not even NFL superstar Tom Brady was able to help mitigate as the brand’s most famous endorser.

The company’s stock has declined 85% from a 2015 peak amid falling sales, rising discounting and questions around founder and CEO Kevin Plank’s leadership style and relationships. He stepped away from the executive role nearly five years ago, but in March announced that he returned to the CEO spot; shares declined 12% immediately after, and it’s only been more bad news since. Year-to-date, shares are down 6%.

Under Armour last week cut its outlook for its fiscal 2025 year, saying it now expected to lose as much as $240 million; revenue declined 10% in its last quarter to $1.2 billion. While CFO David Bergman said the company is continuing work to “reconstitute” its brand, polling firm YouGov reported in July that its overall popularity has fallen to the lowest level in more than two years. Financial services firm Piper Sandler found that Under Armour was losing favor among teen customers who are turning to brands like Deckers Outdoor’s (NYSE: DECK) Hoka and On Holding (NYSE: ONON).

“We are encouraged by early progress in our efforts to reconstitute a premium positioning for the Under Armour brand,” Plank said last month. “Our renewed energy and alignment are proving to be critical enablers as we work to deliver superior products and storytelling while driving efficiencies, reducing promotional activity, and complexity.”

Plank, who told investors on an earnings call that he’d been “growing and maturing,” said he wanted the company he founded in 1996 to be seen as a “sports house” on a par with the great fashion houses of Europe. “Across the sports brand landscape, we believe there are less than five brands that could be represented on this podium for sports globally, and that we are one of them,” he said. Nike (NYSE: NKE), Adidas AG (CBOE: ADS), Puma SE (CBOE: PUMD) and Lululemon Athletica (NASDAQ: LULU) currently all have higher sales.

Plank highlighted the hiring of Eric Liedtke as the company’s new head of brand strategy after a 26-year career at Adidas and said Under Armour would spend $500 million this year on marketing efforts. He wants to target the 16- to 24-year-old varsity athlete and expand focus from the gym to the field.

While Under Armour plans to double its number of paid social media influencers, On’s swift rise to ubiquity may hold a lesson about old-fashioned tactics. The Swiss firm has seen its shares climb 70% over the past year amid soaring sales and its focus on performance design with a style that’s also popular with affluent consumers who wear them around town and to the office. It’s also used a unique distribution model that relied on wholesalers outside of the traditional running ecosystem, and much of the company’s popularity has come from word of mouth referrals.

To be fair, Under Armour is not the only sportswear giant to struggle amid the rise of smaller brands like On and Hoka. Nike shares are down 55% from their all-time high, while Puma has lost 68% from its peak and is down 34% over the past year. Adidas, meanwhile, had fallen as much as 74% from its all-time high but has staged a recovery over the past year with shares rallying 43%.  

For now, Plank—who controls the company with special voting shares—has been careful to manage expectations. “We recognize where we are. We’re not crazy about it,” he said. “There’s not a lot of high fives yet, but there’s definitely a growing sense of, in terms of what we’ve accomplished to date, there’s definitely a sense of what’s coming…We want to make sure that Under Armour isn’t just selling a brand on a T-shirt. It’s not just a logo. It needs to be more.”

Amid the ongoing reinvention attempt, investors may appreciate share repurchases Under Armour conducted last quarter that totaled $40 million. The company is authorized to purchase an additional $460 million, and CFO Bergman said it would make moves as “prudent,” “especially with thinking where the stock price is right now.” With cash on hand totaling $885 million and no outstanding borrowings under a $1.1 billion revolving credit facility, the company may have found a bottom and be willing to defend it.

Under Armour seems to think that its old dog CEO can learn new tricks, but it may be in need of more than just an expensive marketing campaign. The company is talking a big game about storytelling and creating products that people don’t even know they need, while brands like On are winning by focusing on quality and design without the use of gimmicks. Plank could be wise to take heed and let his products speak for themselves.