NIKE Tops Q4 Earnings & Revenues, Shows Progress on Win Now Strategy

Core Insights - NIKE Inc. reported fourth-quarter fiscal 2025 results with revenues of $11.1 billion, a 12% decline year over year, but exceeding the Zacks Consensus Estimate of $10.69 billion [3][8] - Earnings per share (EPS) were 14 cents, down 86% from the previous year, yet above the Zacks Consensus Estimate of 12 cents [2][8] - The company's shares rose 2.8% following the results, although they have lost 1.2% over the past three months compared to a 0.1% gain in the industry [4] Revenue Breakdown - NIKE Brand revenues were $10.8 billion, down 11% year over year, affected by declines across all geographies [5] - In North America, revenues fell 11% to $4.7 billion, with NIKE Direct sales down 14% [6] - EMEA revenues decreased 9% to $3 billion, while Greater China saw a 21% drop to $1.5 billion [10][11] - APLA revenues fell 8% to $1.6 billion, with NIKE Direct dipping 1% [12] Cost and Margin Analysis - Gross profit declined 21% to $4.5 billion, with gross margin contracting 440 basis points to 40.3% due to increased discounts and supply chain issues [13] - Selling and administrative expenses rose 1% to $4.1 billion, with SG&A as a percentage of sales increasing 500 basis points to 37.4% [14] - Demand creation expenses increased 15% to $1.3 billion, while operating overhead expenses decreased 3% to $2.9 billion [15] Balance Sheet and Shareholder Returns - NIKE ended fiscal 2025 with cash and cash equivalents of $7.5 billion, down nearly 24% year over year [16] - The company returned $0.8 billion to shareholders in the fourth quarter, including $202 million in share repurchases and $591 million in dividends [18] Forward Guidance - For fiscal 2026, NIKE expects mid-single-digit revenue decline in Q1 and gross margin contraction of 350-425 basis points [24] - SG&A expenses are projected to increase by low single digits as the company invests in growth initiatives [22] - The company anticipates challenges in digital traffic and classic footwear franchises but sees potential in new product franchises [21][20]