Nike revenue dips 1% to $11B in Q4, beating lowered expectations

Nike Inc. reported fiscal fourth-quarter revenue of $11 billion, down 1% from a year earlier but above Wall Street's $10.86 billion consensus, as the athletic giant's turnaround under CEO Elliott Hill showed early signs of stabilization.

"The results validate our focus on performance product and marketplace discipline," Hill, who is approaching two years in the role, said in a statement. "While we continue to face top-line headwinds, we're encouraged by progress in performance product and are focused on consistent execution, scaling our wins to realize our full potential."

Reported earnings per share came in at $0.72, but that figure included a one-time $986 million recovery of IEEPA tariffs the US Supreme Court ruled unconstitutional in February. Stripped of that windfall, adjusted EPS was $0.20, roughly double the $0.13 consensus estimate. Gross margin of 49.2% was inflated by roughly 900 basis points from the same recovery; underlying margin stood near 40.3%.

Full-year revenue for fiscal 2026 was $46.4 billion, down 2% in constant currency and slightly above the $46.27 billion analyst forecast. Net income for the quarter rose to $1.07 billion from $211 million a year earlier, while full-year net income slipped 3% to $3.1 billion.

By channel, Nike's direct-to-consumer sales fell 9% in the quarter to $4.1 billion, while wholesale revenue edged up 1% to $6.6 billion. For the full year, DTC dropped 8% to $17.7 billion and wholesale rose 4% to $27.5 billion.

North America, Nike's largest market, posted a 3% revenue gain in the quarter to $4.8 billion and a 5% full-year increase to $20.5 billion, reflecting the strongest progress in the turnaround. Greater China remained a drag, with quarterly sales falling 12% to $1.3 billion and full-year revenue down 11% to $5.8 billion. EMEA revenue slipped 1% in the quarter to $2.9 billion but rose 3% for the full year to $12.6 billion. Asia-Pacific and Latin America were flat for the year at $6.2 billion.

Nike Running posted its fifth consecutive quarter of double-digit growth, adding $1 billion to the business. Converse continued to struggle, with quarterly revenue plunging 32% to $244 million and full-year sales down 31% to $1.2 billion. The company cut demand creation spending by 4% to $1.2 billion in the quarter.

Management guided to a further revenue decline in the first half of fiscal 2027, signaling the turnaround remains uneven. The company also announced a planned CFO transition, with former Pfizer executive David Denton set to succeed Matthew Friend on Aug. 17. Nike cut roughly 1,400 roles in April, its second workforce reduction of the year.

Shares fell 3.4% after the report and traded near $40.17, the lowest level in 12 years and roughly 77% below the November 2021 peak near $179. The guidance for continued revenue pressure suggests management is treating fiscal 2026 as a restructuring year. Investors will watch the next earnings call for signs that North America momentum can offset persistent weakness in China and stabilize the broader business.

This article is for informational purposes only and does not constitute investment advice.