Nike shares drop as retailer posts disappointing sales, announces layoffs as part of restructuring

• Nike is expected to post another quarter of declining sales as the company tries to turn around its business and regain growth in China.
• The sneaker retailer previously said it expects sales to be flat for the first half of the fiscal year.
• Nike executives will host a conference call with analysts at 5 p.m. ET.

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Follow your favorite stocksCREATE FREE ACCOUNTPeople pass by a Nike store in New York, Sept. 29, 2026.KHemaz | GVN | Getty Images

Nike is expected to report fiscal first-quarter earnings after the bell Thursday as the retailer struggles to maintain relevancy and sales growth under CEO Elliott Hill.

Former Chief Financial Officer Matt Friend previously said the sneaker company expects sales for the first two quarters of fiscal 2027 to be "flattish," especially as it sees a sales slump in China, a once-lucrative market for the business. Former Pfizer executive David Denton took over as CFO in August.

Still, Nike said it expects its gross margin for the first fiscal quarter to be slightly positive compared with the prior-year period.

Here's what the company is expected to report, based on a survey of analysts by LSEG:

• Earnings per share: 43 cents per share expected
• Revenue: $11.32 billion expected

Nike has been struggling to position itself for growth, including in its most critical markets. Last quarter, it reported $4.83 billion in revenue for North America, its largest market. That was lower than Wall Street expectations of $4.88 billion, according to StreetAccount.

The company has also been struggling in the key China market, with sales dropping 12% last quarter. Hill said on a call with analysts in Junethat Nike is "fully committed" to winning back that market.

For the current fiscal year, analysts are expecting total revenue of around $45.31 billion, according to LSEG. They also expect revenue for the second fiscal quarter to be around $11.79 billion.

Nike had one recent bright spot. The company reported a boost to its results through a nearly $986 million tariff refund, contributing 52 cents per share to its earnings in its previous quarter.

The retailer has been in the midst of a turnaround plan, focused on improving separate parts of its business at different rates based on priority. The Nike consumer has also been under increased macroeconomic pressure as geopolitical tensions and higher inflation lead to slower spending.

In a note last week, Bank of America analysts downgraded the stock from neutral to underperform, saying that "risks are rising" for the sneaker company amid overall sluggishness in the category. The note also pointed to likely further disappointing results for the China market and sustained stock declines.

Shares of Nike have plummeted more than 40% this year.

Nike will host a conference call with analysts at 5 p.m. ET.

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