Financial Data and Key Metrics Changes - For the third quarter, revenues decreased by 9% on a reported basis and 7% on a currency-neutral basis, with strong holiday results in December followed by double-digit declines in January and February [33][32] - Gross margins declined by 330 basis points to 41.5% due to higher markdowns, wholesale discounts, inventory obsolescence, and product costs [33][34] - Earnings per share was reported at $0.54, with SG&A expenses down 8% on a reported basis [34][32] Business Line Data and Key Metrics Changes - The performance business saw growth, particularly in training and running, while Nike sportswear and the Jordan brand experienced declines, especially in classic footwear franchises [35][32] - Running products grew mid-single digits, with notable success from the PEG 41 and Vomero 18 [19][20] - Sportswear footwear, including the Varvero five and Nike Shox, showed significant revenue growth, with the Varvero five doubling its revenue this quarter [22][23] Market Data and Key Metrics Changes - North America revenue declined by 4%, with NIKE Direct down 10% and NIKE Digital down 12% [41][42] - In EMEA, revenue declined by 6%, with NIKE Digital down 25% and NIKE stores up 9% [42][43] - Greater China saw a 15% revenue decline, with NIKE Direct down 11% and NIKE Digital down 20% [44][45] Company Strategy and Development Direction - The company is focusing on five strategic actions termed "Win Now," which include igniting a winning culture, shaping the brand for distinction, accelerating product portfolio, elevating marketplace growth, and winning on the ground [8][9] - There is a commitment to innovate across performance and sportswear categories, with a focus on diversifying the product portfolio and minimizing reliance on classic franchises [26][50] - The company aims to clean up the marketplace and reposition NIKE Digital as a full-price business, reducing promotional days and markdown rates [52][28] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges posed by global economic uncertainty but expressed confidence in the strategic actions taken to drive progress [8][30] - The company expects Q4 to reflect the largest impact from the WinNow actions, with revenue and gross margin headwinds beginning to moderate thereafter [55][54] - There is a focus on serving athletes through innovative products and reigniting brand momentum, with confidence in the product pipeline for the upcoming seasons [57][86] Other Important Information - The company is actively working to enhance its brand presence through significant marketing investments, particularly during major sports events [39][32] - A new brand, NIKE SKIMS, was announced, targeting a new market segment with style-led products [25][26] Q&A Session Summary Question: Timeline for cleaning classic shoe inventories in wholesale and direct channels - Management emphasized the importance of the five Win Now actions and expressed confidence in rightsizing inventory for classic franchises, expecting a reduction in contribution by 10 percentage points by the end of Q4 [64][70] Question: Thoughts on innovation strength and pipeline - Management expressed confidence in the innovation team and highlighted upcoming products from both performance and sportswear categories, with excitement about the spring 2026 product line [74][78] Question: Balancing promotions while amplifying storytelling - Management outlined a strategy to return unsold products from wholesale partners to liquidate through value channels while elevating the presentation of new products in both digital and physical spaces [91][94]