Nike revenues drop in first quarter under new CEO

Nike has reported a 9% drop in third-quarter revenues for fiscal 2025, with sales totaling $11.3bn (£9.1bn), down from $12.4bn (£10.1bn) last year.

On a currency-neutral basis, the decrease is slightly lower at 7%. This marks a continuation of the sportswear giant‘s struggles, as it faces slow consumer demand and declines across key markets.

Direct-to-consumer sales took a major hit, dropping 12%, while wholesale revenue also fell 7%.

The company’s performance was largely driven by a weak showing in its core footwear and apparel segments, which saw a 9% and 3% drop, respectively. Nike’s global brand divisions, including Converse, also reported a combined 18% drop in revenue, adding to the company’s challenges.

During an investor call, CFO Matthew Friend said, “geopolitical dynamics, new tariffs, volatile foreign exchange rates and tax regulations” are among factors creating uncertainty.

Regionally, Nike’s largest market, North America, reported a 4% revenue decrease, while EMEA (Europe, the Middle East, and Africa) suffered a 10% drop.

The decline in Greater China was even steeper, with sales falling 17%. This drop was exacerbated by stiff competition from rival brands, particularly in footwear, as its market share came under pressure from emerging names like On and Hoka. In Asia Pacific & Latin America, the company saw an 11% revenue decline.

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Profitability also took a hit, with Nike’s gross profit falling 16% to $4.7bn (£3.8bn), and its gross margin dropping by 330 basis points to 41.5%.

Net income for the quarter stood at $794m (£644m), a 32% decrease, while diluted earnings per share (EPS) dropped 30% to $0.54 (£0.43).

As a result, the business has not revised its full-year guidance, maintaining its long-term focus on growth and strategic initiatives.

Under the leadership of Elliott Hill, who took over as CEO in October 2024, Nike is focused on navigating through these turbulent times while looking to restore growth

“The progress we made against the ‘Win Now’ strategic priorities we committed to 90 days ago reinforces my confidence that we are on the right path,” said Hill.

In recent weeks, Nike’s collaboration with Skims has piqued significant interest, with the two brands set to launch their new activewear line, NikeSkims this spring.

The partnership, which blends Nike’s sports performance apparel expertise with Skims’ shapewear design, has generated a positive response from both consumers and investors. Following the announcement last month, Nike’s shares saw a notable uptick.

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