Nike unexpectedly reported sales growth in its fiscal first quarter, as the company’s Q1 revenues reached $11.7 billion, up 1 percent on a reported basis.
Although revenue has increased, the company acknowledged ongoing challenges in its turnaround efforts, cautioning that sales may decline once more throughout most of the holiday shopping season.
The company now expects tariffs to cost it $1.5 billion and hit its gross margin by 1.2 percentage points in its current fiscal year 2026, up from the $1 billion and 0.75 percentage point gross margin impact it projected in June.
The earnings release stated: “Inventories for NIKE, Inc. were $8.1 billion, down 2 percent compared to the prior year, reflecting a decrease in units, partially offset by increased product costs, primarily due to higher tariffs in North America.”
Elliott Hill, President & CEO, NIKE, Inc. told investors, “This quarter NIKE drove progress through our Win Now actions in our priority areas of North America, Wholesale, and Running. While we’re getting wins under our belt, we still have work ahead to get all sports, geographies, and channels on a similar path as we manage a dynamic operating environment. I’m confident that we have the right focus in Win Now and that our new alignment in the Sport Offense will be the key to maximizing NIKE, Inc.’s complete portfolio over the long-term.”
Matthew Friend, Executive Vice President & CFO stated, “I’m encouraged by the momentum we generated in the quarter, but progress will not be linear as dimensions of our business recover on different timelines. While we navigate several external headwinds, our teams are focused on executing against what we can control.”
Nike stocks climbed 3% following the announcement.
By CEO NA Editorial Staff
