Nike reported fiscal first-quarter earnings of $0.48 per share, exceeding the consensus forecast of $0.43. Despite this, total revenue fell 4% to $11.2 billion, missing the anticipated $11.32 billion. Net income for the period declined by 2%.
Regional performance showed significant downturns, particularly in Greater China, where revenue dropped 22% to $1.18 billion, and earnings before interest and taxes fell 34% to $248 million. Sportswear revenue declined by a low double-digit percentage, while Jordan Brand revenue slid by a mid-teens percentage.
The company is implementing a restructuring plan dubbed Pace, which aims for $2.5 billion in total savings by fiscal 2031. This initiative involves approximately $1 billion in pretax charges. Layoffs are scheduled to begin in 2027, marking the third round of job cuts this year.
Gross margin increased by 0.6 percentage points to 42.8%, aided by reduced warehousing and logistics costs. Nike provided adjusted earnings guidance of $1.15 to $1.35 per share for the fiscal year ending in May, excluding roughly $0.15 in restructuring costs.
Following the report, Nike shares dropped approximately 8% in after-hours trading. The company has lost roughly 40% of its share value during the current year. CEO Elliott Hill, who assumed his role in October 2024, faces a projected high-single-digit revenue decline for fiscal 2027.
