Nike beats Q1 profit estimates but warns of steeper sales fall this year
Nike's first-quarter profit beat expectations, but the sportswear giant warned full-year revenue will fall by a high-single-digit percentage, sending shares down in after-hours trading.
Nike beat first-quarter profit expectations on Thursday, but warned the pain is far from over — telling investors full-year revenue will fall by a “high-single digit” percentage as its turnaround drags on.
The sportswear giant reported fiscal first-quarter earnings per share of $0.48, just ahead of the $0.44 consensus of analysts surveyed by Visible Alpha, on revenue of $11.21bn — down 4% from $11.72bn a year earlier and below the $11.33bn consensus. Net income was $712m, against $727m a year ago.
Greater China was the weak point, with revenue down 22% to $1.18bn, while EMEA fell 5%. North America rose 2% as wholesale sales to retailers grew 9%, but Nike Direct dropped 8% and Converse fell 28%.
Gross margin improved to 42.8% from 42.2% on lower warehousing and logistics costs, and inventories fell 3% to $7.8bn.
The outlook spooked investors: Nike expects fiscal 2027 revenue to fall by a high-single-digit percentage — worse than the low-single-digit decline analysts expected — and guided adjusted earnings per share of $1.15 to $1.35, against the $1.66 consensus. Shares slid about 6% in after-hours trading to around $33.20, after closing at $35.15, down 0.71%.
“We have more work to do in Nike Sportswear, Jordan Brand and Greater China, and we’re taking deliberate actions to strengthen those businesses the right way for the long-term,” chief executive Elliott Hill said.
Investors get more detail on the turnaround at Nike’s investor day next month.
Sources
- Nike Says Business Will Get Worse Before It Gets Better. The Stock Is Sliding — Investopedia (citing Nike, “NIKE, Inc. Reports Fiscal 2027 First Quarter Results”)
- Nike Stock Falls After Hours as It Guides to a Revenue Decline — AskTraders
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