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Armor is a unit stat that reduces incoming physical damage.

Final Damage = Base Damage × 0.97Armor

In other words, the first point of armor reduces damage by 3%, the second point reduces that damage by 3%, the third reduces that damage by 3%, and so on. For example, 10 points of armor multiplies physical damage by (0.9710 =) 73.74%, which corresponds to a physical resistance of (1 − 0.9710 =) 26.26%.

Physical Resistance = 1 − 0.97Armor

Armor is one source of physical resistance. This stacks multiplicatively with physical resistances from items, abilities, or other effects. For any given resistance, its damage multiplier is equal to 100% minus the resistance value. For example, 20% physical resistance corresponds to an 80% damage multiplier. When you have multiple resistances, multiply their damage multipliers together to determine the total damage multiplier; you can then subtract that from 100% to determine your total physical resistance. For example, two 20% resistances result in 80% times 80%, or 64% damage multiplier, so the total resistance would be 36%.