Explore the latest developments concerning Nike stock drops.
Nike stock drops as revenue falls short of estimates, China sales plunge again
Nike on Thursday posted a mixed fiscal first quarter and announced a restructuring plan that will lead to layoffs starting next year.
The company also offered a full-year outlook, saying it expects revenues to decline by a high-single digit percentage in fiscal 2027. Nike also said it expects adjusted earnings per share to be in a range of $1.15 to $1.35.
Here's what the company reported for the period compared to what analysts expected, according to consensus estimates from LSEG:
Nike reported net income of $712 million, down 2% from $727 million the year prior.
Revenue fell 4% to $11.21 billion. The retailer said Nike brand revenues took a hit largely due to sustained declines in the China business. Revenue in the market dropped 26%.
What's gone wrong at Nike? How the world's sportswear giant lost its mojo
The largest sportswear brand on the planet, named after the ancient Greek goddess of victory, has been losing of late. Losing sales, losing customers and losing ground to its rivals.
The one-time industry disruptor is now the establishment and in the middle of a tricky turnaround plan aimed at clinging on to market dominance.
Nike's latest financial results show signs a turnaround strategy put in place by company veteran Elliott Hill, who was coaxed out of retirement two years ago to lead the firm, is working – but the pace of change is more marathon than sprint.
However, its recovery has been dented by the loss of football star Kylian Mbappé, who ended his 20-year association with the brand last week to join fast-growing Swiss rival, On.
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Nike stock sinks as revenue misses estimates
What happened: Nike (NKE) stock fell as much as 6% in after-hours trading on Thursday.
What's behind the move: Nike posted fiscal first quarter revenue of $11.21 billion, versus consensus estimates of $11.33 billion.
Earnings per share came in at $0.48, down from $0.49 a year ago.
The company said revenues are expected to decline in the high single digits in fiscal 2027. Nike's gross margin, however, expanded 60 basis points to 42.8%.
The results come nearly two years after Elliott Hill took the helm as CEO.
"This is a quarter you'd expect from a new CEO three or four quarters in, but not two years in," CFRA analyst Zach Warring, who has a Buy on the stock, told Yahoo Finance.
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