Abu Dhabi, United Arab Emirates – December 19, 2025:
Nike (NYSE: NKE) beat revenue expectations in the second quarter, but the overall result was far from convincing in its turnaround story. Revenue rose 1% year on year to USD$12.4 billion, ahead of expectations at USD$12.2 billion, but profits fell, which put pressure on the shares in after-hours trade.
North America led the way with revenue up 9% on the year, while EMEA grew 3%, both comfortably beating forecasts. Digital was still under strain, falling 14%, although that was an improvement from last year’s 21% decline. The softness in Greater China continues to be a big drag, with sales falling 17% year on year, well below expectations. Converse was again a weak spot, with revenue down 30%, reinforcing concerns that it’s a brand struggling to find a foothold.
Farhan Badami, Market Analyst at eToro, shares that margins reflected the challenges of another tough quarter. Gross margin fell to 40.6%, down from 43.6% a year earlier, reflecting higher markdowns and ongoing channel mix shifts. Inventories fell 3.2%, which is a slight improvement over expectations, a bright spot as Nike works to reset the marketplace and strengthen relationships with retail partners.
CEO Elliott Hill described Nike as being in the middle innings of its comeback, emphasising progress in the areas that were prioritised early in the strategy shift. That message will reassure some, but the results also underline how much work is still ahead.
Nike is repairing wholesale relationships, cleaning up inventory, and regaining momentum in running, which remains a bright spot, with new products leading the way. But the recovery is happening in pockets rather than across the board. China is still soft, competition is intensifying, and key categories like basketball and sportswear, which carry much of the brand’s weight, are yet to show consistent improvement.
These results show a step in the right direction, but it’s less than what investors wanted. Nike shares have fallen 13% this year and are tracking towards a fourth straight annual decline, meaning patience is thin, and sentiment is rock bottom, especially for a brand built on consistent performance. Ultimately, Nike is jogging forward, not sprinting.
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