Why Nike Stock Is Plunging in After-Hours Trading

Core Insights - Nike's stock experienced a significant decline of 10.2% in after-hours trading following the release of its second-quarter fiscal 2026 financial results, despite a flat performance during regular trading hours [1][5] Financial Performance - Nike reported second-quarter fiscal 2026 sales of $12.4 billion, surpassing analysts' expectations of $12.2 billion, marking a 1% year-over-year increase [3][7] - The company posted diluted earnings per share (EPS) of $0.53, exceeding the anticipated EPS of $0.37 [3][7] Profit Margins - Despite exceeding profit expectations, Nike's net profit margin for Q2 2026 was 6.4%, a decrease from 9.4% in the same period last year, indicating challenges in expanding profit margins [4][7] Market Reaction and Future Outlook - Investors were disappointed with Nike's inability to improve profit margins, particularly in light of the company's 'Win Now' initiative aimed at operational optimization and growth [4][5] - The current decline in Nike's stock price may present a buying opportunity for prospective investors, as the brand is considered formidable and capable of recovery [5]