NIKE 2026 Q1 Earnings Misses Targets as Net Income Falls 31%

NIKE, Inc. reported fiscal 2026 Q1 results on Sep 30, 2025. The company’s revenue grew slightly by 1%, but earnings significantly declined, missing expectations. The company revised its guidance for Q2, forecasting revenue to fall in low single-digit decline and margins to remain pressured.

Revenue
NIKE’s total revenue in fiscal 2026 Q1 increased by 1.1% to $11.72 billion, compared to $11.59 billion in the same period a year ago. The NIKE Brand segment accounted for the majority of the revenue, reaching $11.36 billion, led by Footwear at $7.41 billion and Apparel at $3.31 billion. Equipment generated $630 million, while the Global Brand Divisions contributed $9 million. Converse posted $366 million in revenue, and the Corporate segment reported a negative $8 million. These figures reflect a mixed performance across the company’s product and brand offerings.

Earnings/Net Income
NIKE’s earnings per share (EPS) dropped 30.0% to $0.49 in 2026 Q1 from $0.70 in 2025 Q1. The company’s net income also declined significantly, falling to $727 million in 2026 Q1 compared to $1.05 billion in the previous year—a 30.8% decrease. Despite this setback, NIKE has remained profitable for over 20 years in this fiscal quarter, showcasing its resilience.

Price Action
Following the earnings release, the stock price of NIKE has fallen by 0.49% during the latest trading day, 1.69% during the most recent full trading week, and has declined by 10.51% month-to-date. These figures indicate a negative investor sentiment post-earnings.

Post Earnings Price Action Review
NIKE’s performance in the post-earnings period reflects a challenging market perception, marked by a steady decline in its stock price over the last month. Investors appear to be reacting to the company’s significant earnings decline and the negative guidance for the upcoming quarter. This downward trend indicates a loss of investor confidence despite the company’s long-term profitability and strategic initiatives like the “Win Now” program.

CEO Commentary
Elliott Hill, CEO of NIKE, emphasized the progress made under the “Win Now” strategy, particularly in Running, North America, and wholesale. Running footwear grew over 20%, demonstrating the effectiveness of innovation and sport-specific strategies. However, challenges persist in Sportswear, Greater China, and NIKE Direct, which require structural improvements. Hill introduced the "Sport Offense" initiative, realigning teams by sport and brand, as a key step toward sharper consumer insights and a competitive edge. While acknowledging the long journey to recovery, Hill expressed optimism, noting that progress, although not linear, is in the right direction.

Guidance
Matthew Friend, CFO, outlined Q2 expectations, forecasting revenue to fall in low single digits and gross margin to decrease by 300-375 bps, including a 175 bps headwind from tariffs. SG&A expenses are expected to rise in high single digits. For fiscal 2026, wholesale revenue is projected to return to modest growth, while NIKE Direct remains under pressure. North America is anticipated to lead the recovery, while Greater China and Converse will continue to be headwinds. Margins are expected to improve in the second half due to reduced inventory clearance but remain under pressure from tariffs and market challenges.

Additional News
NIKE has maintained a strong commitment to shareholder returns, with 23 consecutive years of dividend increases. During fiscal 2026 Q1, the company returned approximately $714 million to shareholders. This included $591 million in dividends, a 6% increase compared to the previous year, and $123 million in share repurchases. The repurchase program, which began in June 2022, has retired 1.8 million shares in the quarter, bringing the total repurchased shares to 124.4 million for $12.1 billion. Additionally, the company is hosting a conference call to review the quarter’s results, accessible online at investors.nike.com.