Overview
- Nike updated guidance on Thursday and now expects revenue to fall in the high single digits in fiscal 2027, a bigger decline than Wall Street had forecast.
- The company said it will reorganize its global operations from four regions into three—Americas; Asia‑Pacific and Greater China; and EMEA—and begin further headcount reductions with employee notifications starting in 2027.
- Nike set a target of roughly $2.5 billion in cumulative savings by fiscal 2031, with most of the savings expected to be realized in fiscal 2029 and 2030, signaling a multiyear cost program rather than an immediate turnaround.
- Investors reacted sharply: Nike shares fell about 8.5% in after‑hours trading after the guidance and restructuring were disclosed.
- Analysts say the immediate problems are a 26% drop in China sales in the first quarter and a weak pipeline of compelling new product launches that has pushed the company to rely more on promotions, and the company is also working to rebuild wholesale relationships and refocus on priority sports.