How to Calculate Under Armour’s Gross Profit Ratio for 2015
Use this interactive calculator to compute gross profit, cost of goods sold, and gross profit ratio using Under Armour’s 2015 figures or your own inputs. Below the tool, you will also find a detailed expert guide explaining the formula, the accounting logic, and how to interpret the result in context.
Gross Profit Ratio Calculator
Enter revenue and cost of goods sold values to calculate gross profit ratio. The default values are prefilled with rounded 2015 Under Armour data commonly cited from the company’s annual filings.
Under Armour’s estimated gross profit ratio for 2015 is approximately 48.1% using revenue of 3,963.3 million USD and COGS of 2,058.0 million USD.
Visual Breakdown
The chart compares revenue, cost of goods sold, and gross profit so you can see the ratio visually.
What Is Under Armour’s Gross Profit Ratio for 2015?
If you want to understand how to calculate Under Armour’s gross profit ratio for 2015, you first need to know what the metric actually measures. Gross profit ratio, also called gross margin ratio, shows the percentage of revenue left after subtracting the direct cost of producing or sourcing the products sold. For an apparel and footwear company like Under Armour, that means it measures how much sales value remains after accounting for product costs such as manufacturing, sourcing, and related inventory costs.
For 2015, Under Armour reported net revenues of about $3.96 billion. Using rounded annual report figures, gross profit was about $1.91 billion, which implies cost of goods sold of about $2.06 billion. The gross profit ratio is therefore close to 48.1%. In simple terms, that means Under Armour kept a little over 48 cents of gross profit from every dollar of revenue before operating expenses such as marketing, selling, distribution, and administration were deducted.
Step by Step: How to Calculate Under Armour’s Gross Profit Ratio for 2015
The calculation is straightforward if you have the right numbers from the income statement. Here is the process financial analysts typically follow.
- Find net revenue for 2015.
- Find cost of goods sold, or derive it by subtracting gross profit from net revenue.
- Subtract COGS from revenue to get gross profit.
- Divide gross profit by revenue.
- Multiply by 100 to convert the result to a percentage.
Using 2015 Under Armour figures
- Net Revenue: $3,963.3 million
- Cost of Goods Sold: $2,058.0 million approximately
- Gross Profit: $1,905.3 million approximately
Now apply the formula:
Gross Profit Ratio = ($3,963.3M – $2,058.0M) / $3,963.3M × 100
Gross Profit Ratio = $1,905.3M / $3,963.3M × 100
Gross Profit Ratio = 48.1% approximately
That is the exact logic built into the calculator above. If you type in other values, the tool recalculates the ratio instantly and also updates the chart.
Why the Gross Profit Ratio Matters
Gross profit ratio is one of the most important profitability metrics because it tells you whether a company’s product business model is creating enough value before overhead costs are considered. In retail, branded apparel, and footwear, gross margin is especially important because it reflects pricing power, sourcing efficiency, product mix, markdown discipline, and channel strategy.
For Under Armour in 2015, a ratio around 48.1% suggested the company still had a relatively strong branded product margin at that point in its growth cycle. Investors often compare this ratio across years to answer practical questions such as:
- Is the company becoming more efficient in production and sourcing?
- Is pricing holding up, or are discounts increasing?
- Are higher margin channels like direct-to-consumer growing?
- Is product mix shifting toward footwear, apparel, or accessories?
- How does the business compare with competitors in the athletic apparel market?
Comparison Table: Under Armour 2014 to 2016
The best way to interpret 2015 is to compare it with nearby years. The table below uses rounded figures based on annual report disclosures and common financial summaries. The point is not only the absolute ratio, but also the direction of change.
| Fiscal Year | Net Revenue (USD billions) | Gross Profit (USD billions) | Estimated COGS (USD billions) | Gross Profit Ratio |
|---|---|---|---|---|
| 2014 | 3.08 | 1.49 | 1.59 | 48.3% |
| 2015 | 3.96 | 1.91 | 2.06 | 48.1% |
| 2016 | 4.83 | 2.22 | 2.61 | 45.9% |
This comparison shows that 2015 remained close to 2014 in gross margin terms, but 2016 declined notably. That matters because it tells you 2015 was still part of the period when Under Armour’s gross profitability was relatively stable, even while the business was scaling rapidly.
How to Find the Right Numbers in the Annual Report
When people search for how to calculate Under Armour’s gross profit ratio for 2015, they often know the formula but struggle with where to find the data. The correct source is usually the company’s annual report or Form 10-K. In the filing, look for the consolidated statements of income. Depending on presentation, you may see either:
- Net revenues and cost of goods sold shown directly, or
- Net revenues and gross profit shown, allowing you to infer COGS as revenue minus gross profit
Because company presentations can vary, many analysts compute COGS using the relationship:
Cost of Goods Sold = Net Revenue – Gross Profit
Then they calculate gross profit ratio using gross profit divided by net revenue. As long as the inputs come from the same fiscal period and the same filing basis, the result is valid.
Common Mistakes When Calculating Gross Profit Ratio
Even a simple ratio can be miscalculated. Here are the most common issues to avoid when working with Under Armour’s 2015 data or any company’s financial statements.
1. Using operating income instead of gross profit
Operating income is much lower because it subtracts selling, general, administrative, and other operating expenses. Gross profit ratio only uses revenue and cost of goods sold.
2. Mixing units
If revenue is stated in millions, COGS and gross profit must also be in millions. Never divide a dollar amount by a million dollar amount without converting.
3. Using quarterly data against annual data
If you use 2015 annual revenue, you must also use annual COGS or annual gross profit from the same year.
4. Confusing gross profit ratio with markup
Gross profit ratio divides gross profit by revenue. Markup divides gross profit by cost. These are not the same metric.
5. Ignoring rounding differences
Financial statements are often shown in millions, and publicly quoted summaries may round to one decimal or two decimals. Small differences in the inputs can produce slight differences in the final ratio. That is why one source may show 48.1% while another shows 48.08%.
Interpretation: Was 48.1% Good for Under Armour?
On its own, a gross profit ratio tells you part of the story, not the whole story. A 48.1% ratio in 2015 suggested Under Armour retained nearly half of revenue after direct product costs. That was generally solid for a branded athletic company, especially one in a growth phase. However, gross margin must be interpreted alongside other metrics such as operating margin, inventory turnover, marketing expense, and direct-to-consumer expansion.
A strong gross profit ratio can still coexist with weaker bottom-line performance if the company spends heavily on growth, endorsements, retail expansion, digital investment, or international market development. That is why analysts often pair gross profit ratio with:
- Operating margin
- Net profit margin
- Inventory growth
- Selling and administrative expense ratio
- Cash flow from operations
Comparison Table: Formula Inputs and Output
| Metric | 2015 Value | How It Is Used |
|---|---|---|
| Net Revenue | $3,963.3 million | Top line denominator in the ratio |
| Gross Profit | $1,905.3 million approximately | Numerator after subtracting COGS from revenue |
| COGS | $2,058.0 million approximately | Direct product cost deducted from revenue |
| Gross Profit Ratio | 48.1% | Gross Profit ÷ Revenue × 100 |
How Investors and Students Should Use This Number
If you are a student, the main objective is to demonstrate that you understand the formula and can source the correct inputs from the income statement. If you are an investor or analyst, you should go a step further and ask why the ratio moved, what it says about product economics, and whether the trend is sustainable.
For example, a stable gross profit ratio can indicate strong brand equity and disciplined pricing. A falling ratio may indicate discounting pressure, a less favorable sales mix, rising input costs, currency pressure, or channel changes. In the case of Under Armour, comparing 2015 with the years around it helps you see that 2015 was not just a number in isolation. It was part of a broader business trajectory.
Quick Recap Formula
- Take Under Armour’s 2015 net revenue.
- Subtract 2015 cost of goods sold.
- That gives gross profit.
- Divide gross profit by net revenue.
- Multiply by 100.
- Result: approximately 48.1%.
Authoritative Sources You Can Check
For the most reliable numbers and accounting context, review the original filing and supporting educational sources:
Final Answer
To calculate Under Armour’s gross profit ratio for 2015, use the formula (Revenue – Cost of Goods Sold) ÷ Revenue × 100. With revenue of about $3.96 billion and estimated COGS of about $2.06 billion, the company’s gross profit ratio for 2015 is approximately 48.1%. The calculator above lets you verify that result instantly and experiment with your own assumptions.