Under Armour Tried to Become a Tech Company
Under Armour spent $710 million between 2013 and 2015 acquiring fitness apps. MapMyFitness cost $150 million. Endomondo came next.
Under Armour spent $710 million between 2013 and 2015 acquiring fitness apps. MapMyFitness cost $150 million. Endomondo came next. Then MyFitnessPal for $475 million. CEO Kevin Plank believed Under Armour tech would transform the company from an apparel maker into a digital health powerhouse connecting millions of athletes through data.
It didn’t work……..
By 2020, Under Armour sold MyFitnessPal for $345 million, taking a $130 million loss. Endomondo was shut down entirely. The company now faces seven straight quarters of revenue decline and a 31% probability of bankruptcy. Under Armour tried to become a tech company and destroyed its athletic apparel business in the process.
The Connected Fitness Vision
Plank’s strategy seemed reasonable in 2013. Wearable devices were emerging. Apple was entering health technology. Nike had launched Nike+. Athletic brands were competing on technology as much as design. Plank told investors Under Armour would build “the world’s largest digital health and fitness community.”
MapMyFitness, acquired in November 2013, brought GPS tracking for runners and cyclists. Endomondo added a European user base. MyFitnessPal, the crown jewel purchased in February 2015, brought calorie tracking and 80 million users. Combined, Under Armour tech claimed 120 million registered users.
The promise was compelling. Data from millions of athletes would drive innovation in apparel and footwear while creating new revenue streams through digital services. Collecting data from actual athletes using Under Armour products could improve product development while building customer loyalty through digital engagement.
The problem was execution. Under Armour made workout clothes in Baltimore. The fitness apps operated in Silicon Valley. The company had zero expertise in software development, digital services, or managing consumer technology platforms. These worlds never connected.
Why the Apps Failed
Under Armour tech brought 120 million users but no path to profitability. The three apps operated independently, generating minimal revenue while requiring ongoing development costs. MapMyFitness, Endomondo, and MyFitnessPal competed with each other for similar users rather than creating a unified platform.
More fundamentally, the apps had nothing to do with selling athletic apparel. Runners tracking routes on MapMyFitness didn’t suddenly buy Under Armour shoes. People logging calories in MyFitnessPal weren’t more likely to purchase Under Armour shirts. The connection between fitness tracking and clothing sales never materialized.
Competition was brutal. Apple’s Health app came pre-installed on every iPhone. Google acquired Fitbit. Free alternatives like Strava gained traction. Under Armour tech couldn’t explain why athletes should choose its apps over better alternatives from actual technology companies.
Revenue from Connected Fitness remained negligible. The segment generated modest subscription income but nowhere near enough to justify $710 million in acquisition costs. By 2017, analysts questioned whether Under Armour tech made strategic sense, noting that $710 million could have funded apparel innovation or marketing campaigns instead.
The Integration Disaster
Under Armour never integrated its acquisitions with its core business. The company launched connected shoes with embedded sensors that synced with MapMyFitness. These products flopped. Customers didn’t want shoes that required charging or software updates.
The promised synergy between app data and product development never materialized. Under Armour claimed insights from millions of workouts would improve apparel design. Instead, the company kept developing products the same way it always had. The 120 million app users generated zero meaningful impact on Under Armour’s actual business.
Marketing integration failed equally. Under Armour tech users didn’t become evangelists for Under Armour apparel. The apps attracted people interested in fitness tracking, not people loyal to Under Armour products. Cross-promotion generated minimal results because the connection never made sense.
Then came the data breach. In 2018, Under Armour disclosed that hackers had accessed 150 million MyFitnessPal accounts, compromising usernames, email addresses, and passwords. It was one of the largest security breaches in history.
The breach exposed Under Armour’s inability to manage technology assets. Users questioned why an athletic apparel company was responsible for protecting their personal data. Under Armour lacked the expertise, resources, and focus needed to maintain digital infrastructure. Technology companies invested heavily in security. Under Armour treated its apps as side projects. The 150 million compromised accounts proved it.
Admitting Defeat
By 2020, Under Armour gave up. The company sold MyFitnessPal to Francisco Partners for $345 million, $130 million less than it paid five years earlier. Endomondo was shut down entirely.
After spending $710 million acquiring three fitness apps, Under Armour recovered only $345 million and wrote off the rest as total losses. The Connected Fitness vision that consumed years of management attention produced nothing but financial losses and distraction.
Under Armour still owns MapMyFitness, though the app generates minimal revenue. The company stopped promoting Connected Fitness as a strategic priority, quietly abandoning the technology pivot that once dominated investor presentations.
The direct financial loss exceeded $365 million. The real damage went deeper.
The Real Cost
While Plank chased technology fantasies, Under Armour’s core apparel business deteriorated. Nike and Lululemon strengthened their positions. Adidas mounted a comeback. New brands like Gymshark built digitally native businesses that actually understood technology.
Under Armour lost focus on product innovation, brand building, and customer experience. The distraction came at the worst possible moment. Athletic apparel was becoming increasingly competitive. Under Armour needed to invest in its core business, not acquire software companies it couldn’t integrate.
Brand confusion damaged Under Armour severely. The company tried positioning itself as both an athletic apparel maker and a technology company. Customers didn’t understand what Under Armour represented anymore. The clear positioning that built the brand, authentic athletic performance gear, disappeared.
Under Armour’s messaging became muddled. Its identity became unclear. Its competitive advantage eroded while management chased Silicon Valley dreams that had nothing to do with making workout clothes.
Where Under Armour Stands Now
Under Armour tech directly caused the company’s current crisis. Seven consecutive quarters of revenue decline. North America revenue, its largest market, continues falling. A 31% probability of bankruptcy. The brand that once challenged Nike now struggles for survival.
Kevin Plank stepped down as CEO in 2019 but returned in 2024 to implement the restructuring he should have executed instead of buying fitness apps. The company is cutting 25% of its SKUs and refocusing on men’s athletic apparel. These are the fundamentals Under Armour neglected while pursuing Connected Fitness.
The restructuring feels desperate because it is. Under Armour squandered years and hundreds of millions of dollars while competitors captured market share it can’t reclaim. The company that once represented innovation now represents strategic confusion.
Lessons for Founders
Under Armour tech shows how companies destroy themselves by abandoning core competencies. Athletic apparel companies should make great athletic apparel, not chase technology fantasies because everyone else is doing it. Success in new domains requires expertise, culture, and focus that most companies overestimate.
CEO vision needs checks. Plank’s Connected Fitness pitch sounded compelling, but no one challenged whether Under Armour could execute it or whether it aligned with competitive advantages. Board oversight could have prevented the $710 million waste.
Acquisitions require integration. Under Armour bought three major apps but never made them strategically valuable. Companies always promise synergy. Achieving it is different. Under Armour tech failed because the company couldn’t integrate the apps, not because the apps were worthless.
Brand identity requires consistency. Under Armour confused everyone by trying to become a technology company while making athletic apparel. Successful brands stand for something clear. Under Armour tech muddled the brand and weakened its market position permanently.
The numbers tell the story. $710 million spent. $345 million recovered. $365 million lost directly. Years of distraction. Seven quarters of revenue decline. 31% probability of bankruptcy. Under Armour tried to become something it wasn’t and destroyed what it was. Companies that abandon their core business to chase trends usually fail at both.
Sources:
- DC Rainmaker: Under Armour acquisition total $710M
- TechCrunch: Under Armour sells MyFitnessPal for $345 million
- Modern Retail: Why Under Armour’s app strategy failed
- Macroaxis: Under Armour 31% probability of bankruptcy
- Sportico: Under Armour seventh straight quarter of revenue declines
- PRNewswire: Under Armour acquires fitness apps
- Francisco Partners: MyFitnessPal acquisition
