Under Armour splits with Steph Curry

Under Armor He and Stephen Curry have mutually agreed to end their 13-year partnership, effective immediately, they said in a statement Thursday.

The sudden announcement separated Curry Brand, which makes basketball shoes and apparel, from Under Armor at a time when the sportswear brand was struggling to kick off sales. As part of the spin-off, Curry will retain sole ownership of the Curry Brand and will be free to find another retail partner. Under Armor will release the Curry Brand’s latest Under Armor shoe, the Curry 13, in February.

“This moment for Under Armor is about discipline and focusing on the core UA brand at a critical stage of our turnaround,” Under Armor CEO Kevin Plank said in a statement. “And for Stephen, it’s time to let what we’ve created evolve on his terms. We will always be grateful for what he brought to the UA team.”

“What Curry Brand stands for, what I stand for, and my commitment to that mission will never change, it only gets stronger,” Curry said in a statement. “I am excited for a future focused on aggressive growth, with a continued commitment to continue to show up for the next generation.”

Under Armour’s separation from Curry was announced alongside the expansion of the company’s restructuring plan. The company now expects this to cost $255 million, $95 million more than it previously said, including the departure of the Curry brand, additional contract terminations, impairment charges and severance costs.

Under Armour’s basketball business, including the Curry brand, is expected to generate between $100 million and $120 million in revenue in the current fiscal year, which ends early next year, the company said in a news release. The departure is not expected to have a “material impact” on Under Armour’s financial results or profitability, it said.

Under Armor’s separation from Curry, one of the most successful and best-known basketball players of his generation, comes to a difficult point for the brand. The company has seen a revolving door of senior leadership, sales have fallen for eight consecutive quarters, and Plank is struggling to make it as a premium brand at a time when consumers aren’t spending as much on new clothes and shoes.

Additionally, the competitive landscape has changed significantly since Plank founded the business in 1996. Even industry leaders these days Nike They are struggling to maintain market share against upstarts like On and Hoka, which are attracting top athletes and gaining a new generation of customers. To revive sales, Plank has worked to refine Under Armour’s assortment and more clearly redefine the brand with a strategy that he said will begin appearing on shelves, in stores and on social channels this fall and winter season.

Under Armor shares are down nearly 40% this year. Nike and Adidas, which both have partnerships with a number of top NBA players, did not immediately respond to requests for comment.

Curry’s partnership with Under Armor has long been a focus of the brand and would likely be a key part of its comeback strategy. Given the state of Under Armour’s business, the sudden departure raises questions about what might have caused the split.

Over the past nine years, Curry was mentioned in nearly every single one of Under Armour’s quarterly earnings calls, according to a review of transcripts dating back to 2016. But in the most recent call last week, there was no mention of Curry or the partnership.

During the meeting, Plank talked about the brand’s opportunities in football and signaled that it could do more in basketball.

“You can take a category like basketball, which is worth roughly $100 million to all of us globally. And we think to ourselves that’s incredible for a $5 billion company that couldn’t capitalize on this in a bigger, better way,” Plank said. “So we’re undersized relative to the potential we have and the opportunity to grow it. So we’re approaching a positioning of where we have the right to play, the right to win, and we think we can do a little bit better.”

Curry shocked the sneaker world in 2013 by signing with Under Armor instead of Nike. At the time, Under Armor was a much smaller brand, but Curry said the company “oppressed mentality“

Curry told CNBC Sport earlier this year that he hopes the Curry Brand will move past his playing career and become a brand adopted by other athletes, like Nike’s Jordan Brand. The four-time NBA champion and two-time league MVP is 37 years old and nearing the end of his basketball career and has begun to focus more on other business activities outside of golf and basketball.

Curry Brand launched in 2020. In 2023, the brand signed a new long-term extension, making Curry president under Under Armour’s banner. As part of this agreement, an 11-time NBA All-Star was awarded. 8.8 million Under Armor common shares, It was worth $75 million at the time, in addition to other rewards and incentives.

According to the statement, Under Armor will continue to develop new UA Basketball products after leaving Curry.

“This move allows two strong teams to do what they do best,” Plank said in the statement. “Under Armor focuses on product innovation and performance for athletes at all levels. Curry Brand is gaining the independence to determine its own future. That’s good for Stephen and good for UA.”

— CNBC’s Jessica Golden contributed to this report