How Under Armour signed Stephen Curry away from Nike

Stephen Curry's 2013 decision to sign with Under Armour over Nike, highlighted in CNBC's upcoming documentary "Curry Inc.," involved a $4 million annual deal and a botched Nike presentation. Curry, now president of the Curry Brand within Under Armour, received 8.8 million shares valued at $75 million in 2023 as part of a long-term extension; however, Under Armour's stock has significantly declined since 2016, leading some to speculate that Curry's off-court business prospects have been hindered, though Curry himself says the relationship changed how he thought about his off-court business.

Analysis

Stephen Curry's landmark 2013 signing with Under Armour (UAA) over Nike (NKE), for a reported $4 million annually compared to Nike's $2.5 million offer, represents a significant case study in athlete endorsements and brand strategy. While Curry has achieved considerable personal success, including a 2023 long-term extension that made him President of the Curry Brand and granted him 8.8 million UAA shares then valued at $75 million, Under Armour's corporate performance has been fraught. The company's stock has dramatically declined from its 2016 peak of $45.41 to below $6 per share, impacted by leadership changes, strategic shifts, and intense competition. This divergence has led to speculation, voiced by figures like former Nike executive Nico Harrison, that Curry's off-court business empire might have been substantially larger had he remained with Nike. The article's underlying sentiment is neutral to slightly negative (UAA ticker sentiment: -0.1, NKE ticker sentiment: -0.2), underscoring the complex outcome where Curry's brand thrives individually—emphasizing equity and community initiatives like court refurbishments and the Underrated Golf Tour—while UAA struggles to translate this into sustained shareholder value. Curry's involvement, however, has provided UAA with a flagship athlete and a distinct product line, though its overall impact on reversing the company's fortunes remains a key question for investors.

Key Decisions for Investors

• Investors in Under Armour (UAA) should critically assess the Curry Brand's contribution to revenue and profitability against the backdrop of the parent company's significant stock depreciation and ongoing operational challenges.
• Consider the substantial financial commitment to the Curry partnership, including the $75 million equity grant, in the context of UAA's ability to generate a commensurate return on investment and improve overall market sentiment.
• Evaluate the broader sports apparel sector for the risk that high-profile endorsements, while beneficial for brand visibility and specific product lines, may not be sufficient to counteract systemic issues within a company or guarantee positive stock performance.