Nike: Reset Year. Proof Comes Next.
Nike is rebuilding for growth while repairing margins. The fiscal 2025 print showed the hole. The next four quarters need to show the climb out.
Start with the scorecard. Fiscal 2025 revenue was about $46.3 billion. Down roughly 10 percent year over year. Net income was about $0.2 billion. Diluted EPS was $0.14. Gross margin compressed. Management cited mix and promotions as headwinds.
Shareholder returns stayed intact. Nike returned about $5.3 billion in fiscal 2025. That included $2.3 billion in dividends and $3.0 billion in buybacks. The current repurchase program totals $18 billion and has retired roughly 123 million shares to date.
Guidance tone focused on product and cost. Leadership leaned on a sport performance reset. Running and basketball sit at the center. The company also flagged tighter inventory control and more targeted marketing as levers to rebuild margin. The call framed fiscal 2026 as a transition year where new franchises and colorways start to show up in sell-through, not just on slides.
Macro and policy risks are not trivial. Management discussed tariff pressure and sourcing shifts away from higher duty lanes. Pricing and sourcing actions should offset over time. Near term, they add noise to gross margin and opex.
The setup for investors is clear. Watch if new product cycles show in revenue and if promotions ease. If gross margin recovers while inventory stays lean, operating leverage follows. If the reset stalls, fiscal 2026 turns into another hold-and-wait year.
What Iām watching next. Product sell-through. Running and basketball launch cadence. Fewer promotions. Cleaner channel inventories. Gross margin path. Signs of mix improvement and lower freight and promo drag in reported results. Lastly, cash returns. Dividends and pace of buybacks against earnings recovery and capex needs.
Nike still owns culture and sport. The problem sits in execution. If the product reset lands and promotions fade, the P&L heals. You do not need heroic growth. You need cleaner sell-through, a better mix, and time.