Shares of Nike (NKE) are down 10% after the sneaker maker issued quarterly financial results that disappointed Wall Street.
The company known for its “Swoosh” logo announced earnings per share (EPS) of $0.48 U.S., which beat the $0.43 U.S. consensus expectation among analysts.
However, revenue of $11.21 billion U.S. fell short of the $11.32 billion U.S. that had been forecast on Wall Street. Sales were down 4% from a year earlier.
Management provided forward guidance for its fiscal 2027 year, saying they expect revenue to decline by a high-single digit percentage.
The athletic apparel maker also said that it expects earnings to be in a range of $1.15 U.S. to $1.35 U.S. per share for the entire year.
In the just completed fiscal first quarter, Nike’s sales in China declined 26% from a year earlier. CEO Elliott Hill said the company is “moving with urgency” to improve its business in Asia.
In North America, Nike’s revenue came in at $5.13 billion U.S., which was just above estimates of $5.11 billion U.S.
In addition to its financial results, Nike’s management team announced a restructuring plan to position the company for long-term growth.
Hill said that the restructuring will result in layoffs starting in 2027, though the company did not provide any details on how many jobs it plans to cut.
Nike has undertaken two rounds of job cuts this year, leading to the loss of 2,175 employees.
The latest restructuring plan will see Nike modernize its supply chain, organized its operations into three geographies, build a new campus in India, and overhaul its workforce.
The three new geographic regions will be the Americas, Asia Pacific and Greater China, and Europe, the Middle East and Africa.
The restructuring, which Nike calls “Pace,” is expected to deliver $2.5 billion U.S. in cost savings through fiscal 2031.
The latest drop in the share price comes with NKE stock already down 45% this year and down 76% in the past five years. Nike’s shares are currently trading at $31.76 U.S.
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