Nike reported a 1% year-over-year decline in total revenue for its fiscal 2026 fourth quarter, amounting to $10.97 billion, which surpassed Wall Street's forecast of $10.86 billion. Earnings per share (EPS) rose 42% to 20 cents, exceeding the consensus estimate of 13 cents, although this figure included a 52-cent benefit from the recovery of IEEPA tariffs.
Despite these positive earnings, Nike's shares dropped approximately 2% after hours, bringing the stock price to around $40, down about 35% year-to-date. Analysts express frustration with the slow progress of Nike's turnaround strategy, particularly in light of disappointing sales in North America and ongoing challenges in China, where revenue declined by 12%.
While management has indicated a commitment to improving gross margins and reducing promotions, the overall outlook remains cautious, with expectations of flattish earnings over the next three quarters. The competitive landscape is intensifying, and investors are weighing whether to maintain their positions in Nike or seek better opportunities elsewhere.
The company's performance in the upcoming quarters will be critical, especially with an Investor Day scheduled for November, where new strategies and leadership will be presented