Nike released its second-quarter fiscal 2026 financial results Thursday afternoon, reporting revenue of $12.4 billion, a 1% increase on a reported basis and flat on a currency-neutral basis compared to the same period last year.
The company’s performance varied by region with North America recovering while challenges persist in Greater China.
Nike Q2 Regional Performance
North America was a primary driver for the quarter, with revenue rising 9% in constant currency. This growth in the domestic market helped offset a 16% drop in Greater China and a 4% decline in Asia Pacific & Latin America (APLA).
Revenue in Europe fell 1% in constant currency.
Company Wide Wholesale and DTC Results
Wholesale revenue rose 8% in the quarter, with strength in North America, reflecting Nike’s strategic decision to embrace the wholesale channel again after switching to a mostly DTC focus under the previous CEO.
In Q2, Nike’s DTC channel companywide was more challenged, with revenue falling 8%. Digital sales dropped 14% and brick-and-mortar sales dipped 3%.
Nike Q2 Profits Fall
While top-line revenue saw marginal growth, Nike faced pressure on profitability.
- Gross Margin: Decreased 300 basis points to 40.6%, a decline attributed primarily to higher tariffs in North America.
- Net Income: Fell to $0.8 billion, a 32% decrease compared to the prior year.
- Diluted EPS: Reported at $0.53, also down 32%.
Nike’s New “Win Now” Strategy
Nike executives stressed that they still have a way to go to turn the company around.
“Nike is in the middle innings of our comeback. We are making progress in the areas we prioritized first and remain confident in the actions we’re taking to drive the long-term growth and profitability of our brands,” Nike CEO Elliott Hill said in a statement. “Fiscal ’26 continues to be a year of taking action through Win Now, including realigning our teams, strengthening partner relationships, rebalancing our portfolio and winning on the ground.”
Nike CFO Matthew Friend noted the complexities of the current market. “In the second quarter, we demonstrated the resilience of our portfolio, delivering modest top-line reported growth while managing headwinds from repositioning our business in a dynamic operating environment,” Friend said in a statement.
Stock Market Disappointed in Nike’s Outlook
While Nike’s bottom line results came in better than analysts expected, the company’s forecast of a low-single-digit percentage revenue decline in the current quarter caused the stock to trade nearly 10% lower Friday morning.
