TLDR
- Nike stock drops as Q4 revenue slips and Direct sales weaken sharply
- Nike Direct sales fall 7% as digital and store demand remains soft
- Converse revenue plunges 32%, adding pressure to Nike’s Q4 results
- Nike margin jumps on tariff recovery, but sales weakness hits shares
- Full-year Nike revenue stays flat as Direct sales and China weigh down growth
Nike (NKE) stock fell after the company reported weaker fourth-quarter revenue and softer direct sales. The shares closed at $41.05, down 1.04%, then dropped to $39.65 after hours, down 3.41%. The move followed fresh results that showed pressure across digital sales, stores, Converse, and key overseas markets.
Nike Reports Softer Fourth-Quarter Revenue
Nike reported fourth-quarter revenue of $11.0 billion for fiscal 2026, down 1% on a reported basis. Revenue also fell 4% on a currency-neutral basis, as demand remained uneven across major markets. Wholesale revenue gave the quarter some support and rose 4% to $6.6 billion.
Nike Brand revenue reached $10.7 billion, flat from the prior year on a reported basis. Still, currency-neutral revenue declined 3%, mainly due to weakness in Greater China and EMEA. North America helped offset part of that decline, but it did not fully reverse the pressure.
Nike Direct revenue fell 7% to $4.1 billion, while currency-neutral revenue declined 9%. The segment faced a 12% drop in Nike Brand Digital and a 7% decline in company-owned stores. The results showed continued pressure in channels that Nike has built around direct consumer access.
Direct Sales and Converse Weigh on Results
Converse remained a weak point in the quarter and reported revenue of $244 million. That figure marked a 32% decline on a reported basis and a 34% drop on a currency-neutral basis. The brand declined across all territories, which added more pressure to Nike’s overall sales mix.
Gross margin increased 890 basis points to 49.2% in the fourth quarter. Nike linked the improvement mainly to the expected recovery of International Emergency Economic Powers Act tariffs. The expected tariff recovery added about $986 million and lifted gross margin by around 900 basis points.
Selling and administrative expenses declined 2% to $4.1 billion during the quarter. Demand creation expense dropped 4%, mainly due to lower brand marketing costs. Operating overhead expense fell 1%, as lower administrative costs partly offset wage and currency pressures.
Full-Year Results Show Mixed Business Momentum
For fiscal 2026, Nike reported revenue of $46.4 billion, flat on a reported basis. Revenue declined 2% on a currency-neutral basis, which showed continued top-line pressure across the year. Nike Brand revenue rose 1% as reported, but it slipped 1% on a currency-neutral basis.
Nike Direct revenue fell 6% for the full year to $17.7 billion. The decline reflected a 12% drop in Nike Brand Digital and a 4% fall in Nike-owned stores. Wholesale revenue rose 6% to $27.5 billion, giving the company a stronger channel offset.
Net income for the full year fell 3% to $3.1 billion. Diluted earnings per share also declined 3% to $2.10, while gross margin improved slightly to 42.9%. Nike ended the year with $7.5 billion in inventory and $9.0 billion in cash and short-term investments.
Get 3 Free Stock Ebooks
Discover top-performing stocks in AI, Crypto, and Technology with expert analysis.
- Top 10 AI Stocks - Leading AI companies
- Top 10 Crypto Stocks - Blockchain leaders
- Top 10 Tech Stocks - Tech giants
