Financial Data and Key Metrics Changes - Revenues for Q3 2026 were flat on a reported basis and down 3% on a currency-neutral basis [21] - NIKE Direct declined 7%, with NIKE Digital down 9% and NIKE stores down 5% [21] - Gross margins decreased by 130 basis points to 40.2%, primarily due to higher tariffs in North America [22] - Earnings per share was $0.35 [23] - Inventory decreased by 1% versus the prior year, with units down mid-single digits [23] Business Line Data and Key Metrics Changes - Nike Running grew over 20% for the quarter, while sportswear declined low double digits [9][20] - Wholesale grew 1%, but NIKE Direct and NIKE Digital saw declines [21] - The performance business showed double-digit growth in running, while sportswear continued to be a headwind [20][28] Market Data and Key Metrics Changes - North America revenue grew 3%, with running and global football showing double-digit growth [25] - EMEA revenue was down 7%, with NIKE Direct declining 13% and wholesale down 4% [27] - Greater China revenue declined 10%, with NIKE Direct down 5% and wholesale down 13% [29] - APLA revenue was down 2%, with NIKE Direct declining 8% [31] Company Strategy and Development Direction - The company is focused on a "win now" strategy to improve the health and quality of its business, with a clear plan to complete these actions by the end of the calendar year [7][34] - Emphasis on athlete-centered innovation and building platforms that can scale across multiple sports and price points [5][12] - The company is rebalancing its approach from a NIKE Direct first offense to an integrated marketplace strategy [12][60] Management's Comments on Operating Environment and Future Outlook - Management acknowledges that the comeback is taking longer than expected but remains confident in the strategic direction [34][38] - The company is addressing structural challenges in various markets, particularly in Greater China, and is optimistic about future growth opportunities [18][29] - Management expects revenues to be down low single digits for the next nine months, with North America showing modest growth [33][54] Other Important Information - The company plans to share a more detailed long-term view of the business at an Investor Day later in the year [8] - Significant actions have been taken to clean up the marketplace and manage inventory effectively [21][44] Q&A Session Summary Question: EMEA performance issues and strategy to fix it - Management noted that EMEA faced both progress and challenges, with running showing growth but sportswear underperforming due to macro pressures and increased promotions [42][43] Question: Revenue guidance and impact of Greater China - Management confirmed that while North America is expected to grow, Greater China will face headwinds due to reduced sell-in and marketplace management actions [48][54] Question: Health of D2C gross margins and severance costs - Management emphasized the importance of a balanced marketplace and noted improvements in the quality of D2C sales, particularly in North America [58][60] Question: Stabilization of the sportswear business - Management indicated a shift from defense to offense in sportswear, with some positive signs in classic franchises like Air Force 1 and AJ1 [70][72] Question: Internal vs. external challenges in turnaround efforts - Management acknowledged both internal restructuring and external market conditions as factors in the turnaround taking longer than expected [76][79] Question: Global sportswear outlook - Management provided insights into the current state of the sportswear market and the company's strategies to navigate challenges and capitalize on opportunities [81]

Financial Data and Key Metrics Changes - For Q1 fiscal 2026, revenues increased by 1% on a reported basis but decreased by 1% on a currency-neutral basis [21] - Gross margins declined by 320 basis points to 42.2% due to higher wholesale discounts, increased product costs, and channel mix headwinds [22] - Earnings per share were reported at $0.49 [22] - Inventory decreased by 2% compared to the prior year, indicating progress towards a healthier marketplace [23] Business Line Data and Key Metrics Changes - Nike Direct revenue declined by 5%, with Nike Digital down 12% and Nike stores down 1%, while wholesale grew by 5% [22] - In North America, revenue grew by 4%, with running, training, and basketball each delivering double-digit growth [23] - Sportswear showed growth but faced a 30% decline in classic footwear franchises [24] Market Data and Key Metrics Changes - Greater China experienced a revenue decline of 10%, with Nike Direct down 12% and Nike Digital down 27% [26] - EMEA revenue grew by 1%, with Nike Direct down 6% and Nike Digital down 13% [25] - APLA revenue grew by 1%, with Nike Direct down 6% and Nike Digital down 8% [27] Company Strategy and Development Direction - The company is focusing on a "sport offense" strategy to align its brands (Nike, Jordan, Converse) into more nimble teams by sport, enhancing consumer insights and innovation [6][9] - The strategy aims to maximize the portfolio across various sports and retail channels, leveraging distinct brand identities [7][8] - The company is committed to improving its position in Greater China and enhancing the digital marketplace while reducing reliance on classic franchises [18][32] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the cautious consumer environment and tariff uncertainties but expressed confidence in the win-now actions to drive recovery [19][30] - The company expects Q2 revenues to decline by low single digits, with gross margins down approximately 300 to 375 basis points due to new tariffs [31] - There is an emphasis on long-term growth potential, particularly in North America, while Greater China is expected to face challenges [32][34] Other Important Information - The company has activated 12 sport takeover moments in the past 10 months, connecting athlete performances to commercial assortments [14] - New partnerships, such as with Skims, are aimed at expanding product offerings and reaching new consumer segments [12][11] - The company is investing in Nike ACG to address outdoor activity opportunities, launching new high-performance products [11] Q&A Session Summary Question: Insights on the spring order book and margin recovery - Management highlighted that the spring order book is positive, reflecting growth in North America and a commitment to returning to double-digit margins over time [40][45] - The focus is on reigniting organic growth and improving the full-price mix to achieve margin recovery [46][47] Question: Update on September trading and consumer demand - Management noted that Q1 performance was not influenced by pull-forwards, and they are closely monitoring consumer signals [50][53] - The company expects significant headwinds in Q2 due to reduced promotional activity and a shift in the Dunk franchise [54] Question: Strategies for Greater China and digital business turnaround - Management emphasized the long-term opportunity in China, focusing on innovative products and local athlete activations to drive growth [69][70] - Investments have been made to clean up inventory, but profitability will depend on improved sell-through rates [72]