Under Armour, the sportswear brand that went from basement start-up to billions, confirmed that its accounting practices are under federal investigation, the latest in a series of blows for a brand that is already struggling to turn around its business.
A spokesperson said Sunday that Under Armour has been cooperating with the Securities and Exchange Commission and the Justice Department since the inquiry began in July 2017, and “firmly believes that its accounting practices and disclosures were appropriate.” The SEC and Justice Department declined to comment on the ongoing investigations, but reports indicate that the federal agencies may be investigation whether the athletic wear company shifted revenues from quarter to quarter to smooth declines in performance.
Executives said little about the investigation during an earnings call with analysts Monday morning, saying they were “prohibited” from sharing additional details. They also declined to comment on why it had taken Under Armour more than two years to disclose the investigations, but reiterated that the company was “fully cooperating” with federal authorities.