What happened: Nike (NKE) stock fell 6% after hours Thursday.
What’s behind this move: Nike reported first-quarter revenue of $11.21 billion, compared to the consensus estimate of $11.33 billion.
Earnings per share were $0.48, up from $0.49 a year ago.
The company said its revenue is expected to decline in the range of 10% in fiscal 2027. Nike’s gross margin, however, increased 60 basis points to 42.8%.
35:15 -0.25 (-0.71%)
At close: 4:00:02 p.m. EDT
The results come nearly two years after Elliott Hill took over as CEO.
“This is a quarter that you would expect a new CEO to be in three or four quarters, but not in two years,” CFRA analyst Zach Warring, who has a Buy on the stock, told Yahoo Finance.
The analyst noted that “valuations and expectations have been reset.”
“Now they can kind of move forward and start to get back to growth, increase their margins and start to really work on some geographies where they’re slow, which is obviously China and Europe,” he added.
Learn more: Caitlin Clark’s new signature Nike shoe almost sold out within two hours of going on sale
What else do you need to know: The company was already facing challenges when Hill took over. Nike had pulled out of several major retail partners as it sought to prioritize its own sales channels, giving its competitors an opportunity to gain ground.
The recovery was not easy.
“We still have work to do at NIKE Sportswear, Jordan Brand and Greater China, and we are taking deliberate steps to strengthen these businesses in the right way over the long term,” Hill said in the company’s earnings press release.
In late August, Dick’s Sporting Goods (DKS) issued a stark warning about its business, in part because Nike is giving deep discounts on slow-moving products.
Football icon Kylian Mbappé ended his long-term business partnership with Nike last month and announced he would now join Swiss sports giant On (ONON).
Nike stock recently fell from the S&P 100 (^SP100) after nearly 20 years in the index.
Thursday’s report is the first earnings release under new CFO Dave Denton, who previously held a position at Pfizer.
Ines Ferre is a senior economics reporter for Yahoo Finance.
Click here for in-depth analysis of the latest stock market news and events that move stock prices.
Read the latest financial and business news from Yahoo Finance
Gn bussni
