Nike revenues fell 5% year-on-year on a constant currency basis for the first quarter of fiscal 2027 to $11.2 billion, the brand said on Thursday, missing analyst expectations of $11.35 billion. Shares fell 6% in after-hours trading, and Nike stock now sits at the lowest level it has since 2013. Nike was also delisted from the S&P 100 for the first time in 18 years on September 21. (Q1’s performance was, however, in line with Nike’s own expectations.)
“For the first quarter, results were in line with our expectation. Last fiscal year, we grew the [Nike brand performance portfolio] business to $16 billion. We built on that foundation this quarter, growing Nike performance by another high-single digits,” president and CEO Elliott Hill told investors on Thursday’s call. “Despite that progress, our Nike performance business is not yet large enough to offset the pressure we’re seeing in Nike sportswear, Jordan brand, and greater China. We’re taking deliberate actions to strengthen those businesses, but realizing the full benefit of those efforts will take time.”
Hill also welcomed new CFO Dave Denton, who joined the company on August 17. “Dave brings deep financial expertise, strong operational leadership, and a proven track record of helping world-class companies grow,” he said.
On the call, the pair introduced changes to Nike’s operating model under a program called Pace, which will involve geographical reorganization and layoffs across the company. “The purpose of Pace is clear, to accelerate the sport offense. It will change how and where we work, move decisions and roles closer to the consumer and build capabilities that will allow us to move faster,” Hill said. “The sport offense has proven itself. Pace is how we scale it.” Pace is expected to result in $2.5 billion in savings, Denton said.
The new plan arrives at a rough moment for Nike. Last month, Kylian Mbappé left Nike for challenger brand On, in a move that harkened back to Roger Federer’s 2018 exit. In recent years, big-name athletes including Lamine Yamal, Harry Kane and Ousmane Dembélé all left for competitors. It’s a reflection of Nike’s waning sportswear dominance, a trajectory Hill sought to put a halt to when he joined the company two years ago and introduced his ‘sport offence’ turnaround plan — which is now the one he says Pace will accelerate.
First-quarter revenues for the Nike brand were $11 billion, down 4% year-on-year, primarily due to declines in Greater China and EMEA which were partially offset by North American growth. Revenues for Converse were down 28% to $263 million. By channel, Nike direct-to-consumer (DTC) revenues took a hit, down 9% year-on-year to $4.1 billion. Nike’s wholesale fared better, with revenues down 1% to $6.8 billion.
