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- **North America Dominance**: 9% revenue growth, Running up over 20%, NIKE Digital Black Friday record. Wholesale growth balanced across new and existing partners.
- **China Challenges**: 16% revenue decline, off-price selling cycle. Actions include inventory cleanup and store pilots, but recovery slow.
- **Tariff Headwinds**: $1.5B annualized impact, net 120bps reduction through pricing. Q3 gross margin down 175-225bps (excluding tariffs).
- **Strategic Focus**: Sport offense driving innovation pipeline (Nike Mind, Aero-FIT). Committed to double-digit EBIT margins, with North America leading recovery.

**【CEO Summary Section】**
- **Strategic Progress**: Highlighted progress in 'Win Now' actions and the 'sport offense' strategy, emphasizing athlete-centered innovation across 190 countries.
- **North America Growth**: Q2 revenue up 9%, driven by Running (over 20% growth), Basketball, and Training. NIKE Digital saw its best Black Friday with Jordan Black Hat launch success.
- **China Challenges**: Revenue down 16% due to off-price selling and aged inventory. Actions include store pilots, reduced sell-in plans, and inventory cleanup, but recovery expected to take time.
- **Product Diversification**: Rightsizing Classics franchises (down over $4B YoY) and expanding into SKIMS, Nike Mind, and Aero-FIT innovations.
- **Margin Focus**: Committed to double-digit EBIT margins, with North America showing early signs of margin recovery despite tariff headwinds.

**【CFO Financial Commentary】**
- **Q2 Results**: Revenue flat YoY (1% reported), NIKE Direct down 9%, Wholesale up 8%. Gross margin 40.6% (-300bps YoY) due to tariffs and China obsolescence.
- **Tariff Impact**: $1.5B annualized tariff headwind, net impact reduced to 120bps through pricing and cost management.
- **Q3 Guidance**: Revenue down low single digits, gross margin down 175-225bps (excluding 315bps tariff impact). SG&A up low single digits due to demand creation.
- **North America Momentum**: Wholesale growth and order book improvement, with confidence in sustaining momentum.

**【Q&A Highlights】**
- **Margin Recovery Timeline**: No specific timeline, but North America showing early signs. China and Converse expected to remain challenging in Q3.
- **China Reset**: Requires new capabilities and fresh approach; early store pilots show promise but progress slow.
- **Product Growth Drivers**: Running, SKIMS, and Basketball leading innovation pipeline. Order book up for back half of FY26.
- **Wholesale Impact**: Wholesale growth creates cost leverage, with focus on demand creation for long-term brand health.

NIKE, Inc. (NKE) Q2 2026 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

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