Suit Controversy Won’t Slow Down Under Armour and U.S. Speedskating

Source: adrian8_8 / Flickr

Under Armour (NYSE:UA) had a rough go of it this year at the Winter Olympics, but it’s not because its executives didn’t live up to expectations — it’s because the athletes they outfitted didn’t. Anyone remotely interested in the Sochi games likely heard of the controversy that brewed between the U.S. speedskating team and its sponsor, Under Armour.

After arriving in Russia with a number of favorites, the speedskaters failed to even come close to the podium, and instead of questioning the athletes, people questioned their sponsor. Under Armour faced criticism that its suits were responsible for slowing down skaters in Sochi, and although U.S. skating coach Kip Carpenter stood by his sponsor and denounced any charges, he couldn’t silence the noise that a design flaw in the Under Armour suits’ rear ventilation panels were slowing down the athletes.

The controversy has just about sizzled out now that the 2014 Winter Olympics are due to, as well, but there were still lingering questions that Under Armour finally answered this week. In a surprising turn of events, the Wall Street Journal reported Friday that Under Armour confirmed that the two parties will renew their partnership through the 2022 Olympic Games.

U.S. Speedskating Executive Director Ted Morris told athletes in an email, seen by the Journal, that he was surprised Under Armour agreed to sponsor another round at the Olympics because the sports clothing company underwent a great deal of criticism at the games, which could potentially jeopardize its business moving forward. He wrote to the athletes: “We were not that optimistic, to be honest. When you look at how things transpired it’s tough to imagine any company saying, ‘We want to stick with these guys.’ From our standpoint, that was hard to fathom.”

Regardless of how surprised the team’s directors were, Under Armour is back on board for 2022 and hopefully won’t need to navigate any more charges that its suits are to blame for the athletes’ poor performance. Despite the onslaught of disparagement, Under Armour stood by its suits throughout the course of the games, and so too did Carpenter, who told reporters last week that a skater doesn’t lose a second in the 1,000-meter race “because of a skin suit.”

Under Armour did end up giving the speedskating team the option of reverting to a previous design to finish out the games, and the team elected to do so — but that didn’t change much. Skaters continued to perform at a disappointing level, and many even pointed at the controversy as a reason they couldn’t finish as strongly as expected. Nonetheless, they’ll still be wearing Under Armour suits in 2022, though we wouldn’t be surprised if the company takes another look at those products.

The maker of sports apparel and footwear has fared well in recent years, providing significant competition for Nike (NYSE:NKE), but Under Armour still suffered a 2.38 percent stock drop when news broke that it could be responsible for the U.S. athletes’ disappointing performances. And investors are still hesitant to say how the company will forge forward into the future, now that it is looking to expand globally and many have heard about its controversy in Russia.

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