Revenue Performance - Full year revenues for NIKE, Inc. were $46.3 billion, down 10% on a reported basis compared to the prior year[5] - Fourth quarter revenues were $11.1 billion, down 12% on a reported basis and down 11% on a currency-neutral basis[6] - Revenues for the NIKE Brand were $44.7 billion, down 9% on a reported and currency-neutral basis, driven by declines across all geographies[9] - Total revenues for NIKE, Inc. decreased by 12% to $11,097 million for the three months ended May 31, 2025, compared to $12,606 million for the same period in 2024[18] - For the twelve months ended May 31, 2025, total revenues were $46,309 million, down 10% from $51,362 million in the previous year[18] - Footwear sales in North America dropped by 13% to $3,104 million for the three months ended May 31, 2025, and also decreased by 13% to $12,684 million for the twelve months[18] - Sales through NIKE Direct fell by 13% to $18,783 million for the twelve months ended May 31, 2025, compared to $21,519 million in the previous year[20] - Sales to wholesale customers for the twelve months ended May 31, 2025, were $25,883 million, a decrease of 7% from $27,758 million in the previous year[20] - The Greater China region experienced a significant decline, with footwear sales down 21% to $1,074 million for the three months ended May 31, 2025[18] Profitability and Earnings - Net income for the fourth quarter was $0.2 billion, down 86%, with diluted earnings per share at $0.14, also a decrease of 86%[9] - Earnings before interest and taxes (EBIT) for the total NIKE brand decreased by 58% to $894 million for the three months ended May 31, 2025, and by 34% to $5,740 million for the twelve months[22] - The EBIT margin for NIKE, Inc. was 2.7% for the three months ended May 31, 2025, down from 13.3% in the same period last year[22] - Diluted earnings per share (EPS) for the three months ended May 31, 2025, was $0.99, compared to $3.73 for the same period in 2024[24] Expenses and Corporate Financials - Gross margin for the fourth quarter decreased 440 basis points to 40.3%, primarily due to higher discounts and changes in channel mix[5] - Selling and administrative expenses increased 1% to $4.1 billion in the fourth quarter, with demand creation expense up 15% to $1.3 billion[6] - Corporate expenses increased, with a net loss of $625 million for the three months ended May 31, 2025, compared to a loss of $559 million in the same period last year[22] Shareholder Returns - In fiscal 2025, the company returned approximately $5.3 billion to shareholders, including $2.3 billion in dividends, up 6% from the prior year[8] Taxation - The effective tax rate for the fourth quarter was 33.6%, compared to 13.1% for the same period last year[9] Assets - As of May 31, 2025, total assets for NIKE, Inc. were $36.6 billion, down 4% from the prior year[16]

Core Viewpoint - Nike is set to report earnings, with expectations of a gain of $0.12/share on $10.67 billion in revenue, while the Whisper number suggests a gain of $0.21/share [3] Financial Performance - Nike's earnings have fluctuated over the past few years, with earnings per share (EPS) of $1.84 in 2020, $3.56 in 2021, $3.75 in 2022, $3.23 in 2023, and projected EPS of $3.95 in 2024, $2.15 in 2025, and $1.85 in 2026 [4] - The stock has a price to earnings (P/E) ratio of 20, which is 0.8x lower than the benchmark S&P 500 [4] Market Sentiment and Technical Analysis - The stock is currently in a long downtrend and trading below its 200-day moving average, indicating a potentially unhealthy market position [6] - The relative strength (RS) rating of the stock is only 14, suggesting very low market performance [6] Tariff Impact - The upcoming earnings report may address the impact of tariffs, as Nike imports its sneakers from abroad, which could significantly affect future guidance [5]

Economic Data Summary - Initial Jobless Claims decreased by 9,000 to 236,000, marking the lowest level since mid-May [2] - Continuing Claims reached 1.974 million, the highest level since mid-November 2021, remaining above 1.9 million for five consecutive weeks [2][3] - Q1 GDP was revised down to -0.5%, the weakest quarter since Q1 2022, with consumption growth cut from +1.2% to +0.5% [4] - Durable Goods Orders surged by 16.4%, significantly exceeding the anticipated 7%, driven by a 234% increase in non-defense aircraft orders [6] - The Advanced U.S. Trade Balance for May worsened to -$96.6 billion, with exports falling by 5.2% [7] - Advanced Retail Inventories increased by 0.3% month over month and 3.2% year over year, while Wholesale Inventories decreased by 0.3% [8] Company Insights - Nike is expected to report fiscal Q4 results with an anticipated earnings decline of 88% year over year and a 15% drop in revenues, despite a history of beating earnings estimates [10]

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Core Viewpoint - Nike, Inc. is expected to report a significant decline in quarterly earnings and revenue for the fourth quarter compared to the previous year [1] Financial Performance - Analysts predict Nike will report earnings of 13 cents per share, down from 99 cents per share in the same quarter last year [1] - Projected quarterly revenue is $10.72 billion, a decrease from $12.61 billion a year earlier [1] Analyst Ratings and Price Targets - Nike has beaten revenue estimates in two consecutive quarters and in six of the last ten quarters overall [2] - Evercore ISI Group analyst Michael Binetti maintains an Outperform rating but has reduced the price target from $97 to $75 [4] - Deutsche Bank analyst Krisztina Katai maintains a Buy rating with a reduced price target from $77 to $71 [4] - Barclays analyst Adrienne Yih holds an Equal-Weight rating and has cut the price target from $60 to $53 [4] - Morgan Stanley analyst Alex Straton also maintains an Equal-Weight rating, lowering the price target from $70 to $61 [4] - Wells Fargo analyst Ike Boruchow maintains an Equal-Weight rating and has raised the price target from $55 to $60 [4]

Core Insights - The upcoming Q2 earnings cycle is anticipated to gain momentum with major banks reporting, but several companies, including NIKE, are already releasing results, contributing to the overall Q2 performance [1] - NIKE's stock has declined 18% in 2025, significantly underperforming the S&P 500 [1] Company Performance - Initial tariff announcements negatively impacted NIKE's profitability outlook, contributing to its poor performance [3] - Analysts have shown modest positivity regarding NIKE's upcoming earnings release, with the Zacks Consensus EPS estimate at $0.11, a slight increase since early April [4] - Revenue expectations for NIKE are set at $10.6 billion, reflecting a minor increase of 0.3% [4] - Despite some stability in revisions, NIKE is expected to see an 89% drop in EPS and a 15% decrease in sales, indicating ongoing demand challenges and profitability issues [5] - NIKE is scheduled to report quarterly results on June 26th, with weak demand trends post-pandemic being a significant concern [7] Financial Metrics - NIKE's gross margin has decreased by 330 basis points year-over-year, reflecting pressure from higher costs [10] - The stock is currently trading at a forward 12-month earnings multiple of 31.3X, above its five-year median of 30.7X and higher than the Zacks Apparel industry average [12] - The PEG ratio stands at 2.1X, consistent with the five-year median, compared to the industry average of 1.1X [12] Peer Comparison - Birkenstock (BIRK) has experienced positive EPS revisions and strong demand across its product lines, contrasting with NIKE's struggles [15] - Birkenstock has increased its revenue guidance and reported double-digit sales growth across all segments, with gross margin expanding from 56.3% to 57.7% [16] - While NIKE's outlook remains negative with a Zacks Rank of 4 (Sell), Birkenstock holds a Zacks Rank of 2 (Buy), indicating healthier demand trends and margin expansion [19]

Core Insights - NIKE Inc. (NKE) is fundamentally strong but faces valuation concerns with a forward 12-month P/E multiple of 31.58X, significantly higher than the industry average of 24.76X [2][4] - The company's high price-to-sales (P/S) ratio of 2X compared to the industry's 1.74X raises investor unease, compounded by a low Value Score of D [3][4] - NIKE's stock has underperformed compared to competitors like adidas and Skechers, which have lower P/E ratios and have experienced smaller declines in stock price [4][9] Financial Performance - NIKE's stock has dropped 18.9% year-to-date, similar to the broader industry's decline of 18.5%, while the Consumer Discretionary sector has grown by 8.1% [8] - The company reported a 17% drop in sales in Greater China and a 9% year-over-year revenue decline in Q3 fiscal 2025, indicating ongoing operational challenges [7][17][20] - Guidance for the fiscal fourth quarter indicates a 22% year-over-year revenue drop and a significant contraction in gross margin by 400-500 basis points [7][19][20] Market Position and Competitive Landscape - NIKE's premium valuation is not aligned with its growth trajectory, especially in light of slowing sales and earnings [5][24] - The company is facing challenges in its core lifestyle segment, with iconic footwear lines experiencing sharper declines than the overall business [15][16] - Despite ongoing investments in grassroots sports initiatives, the short-term outlook remains difficult, with management's guidance reflecting a cautious approach [18][20] Estimate Revisions - The Zacks Consensus Estimate for NIKE's fiscal 2025 earnings per share has shown a slight uptrend, with a projected 10.7% decline in sales and a 45.8% decline in EPS year-over-year [21][23] - For fiscal 2026, the consensus indicates modest growth of 1.3% in sales and 12.1% in earnings year-over-year [23]

Core Viewpoint - The article discusses Faith Kipyegon's attempt to break the 4-minute mile barrier for women, a feat considered nearly impossible for female athletes, with significant support from Nike's innovative technology and expert team [3][5][11]. Group 1: Kipyegon's Achievements and Goals - Faith Kipyegon set a new women's mile record of 4 minutes 07.64 seconds on July 22, 2023, improving the previous record by approximately 8 seconds [2][3]. - Kipyegon aims to complete the mile in under 4 minutes, a challenge that has been deemed unattainable for decades [3][5]. Group 2: Nike's Support and Innovation - Nike's approach to Kipyegon's challenge mirrors its previous "Breaking2" marathon project, utilizing a team of experts in various fields to optimize every detail of the performance [7][8]. - The team focuses on factors such as weather, athlete oxygen consumption, and equipment design to maximize Kipyegon's potential [7][8]. - Kipyegon is equipped with custom-designed gear, including the Fly Suit and Nike Victory Elite FK spikes, which are engineered for aerodynamics and performance [9][20]. Group 3: Technological Advancements in Running Gear - Nike's Fly Suit features 3D-printed Aeronodes to enhance speed and reduce drag, showcasing the brand's commitment to innovation [9][11]. - The Nike FlyWeb sports bra utilizes revolutionary 3D-printed materials, providing a lightweight and breathable experience for athletes [9][11]. - Nike has a history of introducing groundbreaking running shoe technologies, such as the Vaporfly series, which have transformed the running shoe market [13][15]. Group 4: Brand Strategy and Market Positioning - Nike's "Win Now" strategy emphasizes a return to the core of sports and innovation, aiming to strengthen its competitive edge in the athletic apparel market [24][25]. - The brand's recent advertising campaigns resonate with athletes by highlighting the challenges they face, reinforcing the value of perseverance and achievement [26][28]. - Nike's initiatives, such as the After Dark Tour for female runners, demonstrate its commitment to addressing the specific needs of diverse consumer groups [26][28].

Sometimes iconic companies go through a rough patch -- Apple nearly going bankrupt in the late 1990s is perhaps the most extreme example. More recently, Netflix stock dropped to a low of $166 per share in 2022 after increased competition led to subscriber losses, and Amazon's stock dipped under $82 per share at the start of 2023, when growth in AWS slowed.Both stocks skyrocketed after ironing out the issues. Nike (NKE 1.12%) is currently experiencing a rough patch of its own. The stock is 66% off its 2022 h ...

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