Under Armour 2015 Annual Report Download - page 9

PART I
ITEM 1. BUSINESS
General
Our principal business activities are the development, marketing and distribution of branded performance
apparel, footwear and accessories for men, women and youth. The brand’s moisture-wicking fabrications are
engineered in many designs and styles for wear in nearly every climate to provide a performance alternative to
traditional products. Our products are sold worldwide and are worn by athletes at all levels, from youth to
professional, on playing fields around the globe, as well as by consumers with active lifestyles.
Our Connected Fitness strategy is focused on connecting with our consumers and increasing awareness and
sales of our existing product offerings through our global wholesale and direct to consumer channels. We plan to
engage and grow this community by developing innovative applications, services and other digital solutions to
impact how athletes and fitness-minded individuals train, perform and live.
Our net revenues are generated primarily from the wholesale sales of our products to national, regional,
independent and specialty retailers. We also generate net revenue from the sale of our products through our direct
to consumer sales channel, which includes our brand and factory house stores and websites, from product
licensing and from digital platform licensing and subscriptions and digital advertising through our Connected
Fitness business. A large majority of our products are sold in North America; however we believe that our
products appeal to athletes and consumers with active lifestyles around the globe. Internationally, our net
revenues are generated from a mix of wholesale sales to retailers and distributors and sales through our direct to
consumer sales channels, and license revenue from sales by our third party licensees. We plan to continue to
grow our business over the long term through increased sales of our apparel, footwear and accessories, expansion
of our wholesale distribution, growth in our direct to consumer sales channel and expansion in international
markets. Virtually all of our products are manufactured by our unaffiliated primary manufacturers operating in 16
countries outside of the United States.
We were incorporated as a Maryland corporation in 1996. As used in this report, the terms “we,” “our,”
“us,” “Under Armour” and the “Company” refer to Under Armour, Inc. and its subsidiaries unless the context
indicates otherwise. We have registered trademarks around the globe, including UNDER ARMOUR®,
HEATGEAR®, COLDGEAR®, ALLSEASONGEAR®and the Under Armour UA Logo, and we have applied to
register many other trademarks. This Annual Report on Form 10-K also contains additional trademarks and
tradenames of our Company and our subsidiaries. All trademarks and tradenames appearing in this Annual
Report on Form 10-K are the property of their respective holders.
Products
Our product offerings consist of apparel, footwear and accessories for men, women and youth. We market
our products at multiple price levels and provide consumers with products that we believe are a superior
alternative to traditional athletic products. In 2015, sales of apparel, footwear and accessories represented 71%,
17% and 9% of net revenues, respectively. Licensing arrangements, primarily for the sale of our products, and
revenue from our Connected Fitness business represented the remaining 3% of net revenues. Refer to Note 16 to
the Consolidated Financial Statements for net revenues by product.
Apparel
Our apparel is offered in a variety of styles and fits intended to enhance comfort and mobility, regulate body
temperature and improve performance regardless of weather conditions. Our apparel is engineered to replace
traditional non-performance fabrics in the world of athletics and fitness with performance alternatives designed
and merchandised along gearlines. Our three gearlines are marketed to tell a very simple story about our highly
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