BusinessJun 30, 2026
Nike Stock Falls as China Weakness Offsets Earnings Beat
Athletic Retail
Rhea Lobo
Discover
Nike reported fiscal fourth-quarter revenue of $10.97B on June 30, topping Wall Street's estimates, but a one-time tariff refund inflated the headline profit figure.
Earnings per share came in at 72 cents. Analysts flagged that 52 of those cents came from an expected tariff refund tied to Supreme Court-struck emergency-powers import duties. Strip that out and the beat looks far narrower.
Shares slipped in after-hours trading, continuing a slide that has taken the stock down 35% year to date.
CEO Elliott Hill, who came out of retirement in late 2024 to lead the turnaround, has centered his strategy on rebuilding wholesale relationships that his predecessor John Donahoe damaged when Nike shifted hard toward direct-to-consumer. That work is showing up in North America, where wholesale revenue rose 4% in the quarter and revenue growth is up 15 percentage points from its lowest point under Donahoe.
China is a different story. Sales fell 17% in the region on a constant-currency basis, worse than the 10% drop in the prior quarter. Greater China accounts for roughly 15% of annual sales and was historically Nike's highest-margin region, but local rivals Anta and Li Ning have been taking share and a bloated inventory glut is keeping prices low.
Outgoing CFO Matt Friend said sell-through efforts remain challenged, and Hill acknowledged persistent revenue headwinds. Nike expects China revenue to fall further, from roughly $6B to $5.5B through August.
Nike outfits 12 national teams at the 2026 FIFA World Cup and has leaned heavily into marketing, running ads featuring Cristiano Ronaldo, Kylian Mbappe, and LeBron James. Its Rip the Script campaign drew 78M views compared with 7.8M for rival Adidas's equivalent effort.
The merchandise numbers back up the buzz. Research from LSEG showed that 28% of Nike's merchandise related to the tournament had sold out since it began, versus 7% for Adidas. USA home and away jerseys sold out across Nike's website and major retailers including Dick's Sporting Goods and Fanatics, with US Soccer reporting more than double the jersey volume sold through the group stage compared with the 2022 World Cup.
Nike said additional inventory would be available July 1, though a retail executive told The Athletic that supply shortfalls stemmed from Nike repeatedly ignoring retailer requests to produce more stock ahead of major events.
Incoming CFO David Denton, currently at Pfizer, takes over Aug. 17. An investor day in Oregon is expected later this year, where management will face pressure to show a clearer path back to full-price selling and margin recovery.
