10-QPeriod: Q3 FY2026

NIKE, Inc. Quarterly Report for Q3 Ended Feb 28, 2026

Filed April 1, 2026For Securities:NKE

Summary

NIKE, Inc. reported flat revenues of $11.3 billion for the third quarter of fiscal year 2026, with a 3% decrease on a currency-neutral basis. While overall revenues remained stable, the company is undergoing strategic initiatives to rebalance its product portfolio and marketplace, which have led to a decline in NIKE Direct sales and a reduction in gross margin. For the nine months ended February 28, 2026, revenues increased slightly by 1% to $35.4 billion, but also showed a 1% decrease on a currency-neutral basis. Profitability was impacted by several factors, including higher tariffs in North America which reduced gross margin by 130 basis points in the quarter. Net income for the quarter decreased significantly by 35% to $520 million, resulting in diluted earnings per share of $0.35. The company is actively managing inventory and repositioning its digital platform while reinvesting in wholesale distribution, which are expected to negatively impact near-term revenues and profitability but are aimed at driving long-term shareholder value. The company also incurred $230 million in pre-tax charges for employee severance costs in the quarter.

Financial Highlights

47 data points
Beta

Revenue

$11.28B

40.2% Gross Margin

Net Income

$520.00M

4.6% Net Margin

EPS (Diluted)

$0.35

Total Assets

$37.06B

Cash & Equivalents

$6.66B

Free Cash Flow

$284.00M

Financial Statements
Beta
Revenue$11.28B
Cost of Revenue$6.75B
Gross Profit$4.53B
SG&A Expenses$3.98B
Net Income$520.00M
EPS (Basic)$0.35
EPS (Diluted)$0.35
Shares Outstanding (Basic)1.48B
Shares Outstanding (Diluted)1.48B

Key Highlights

  • 1Revenues for the third quarter of fiscal 2026 were $11.3 billion, flat on a reported basis and down 3% on a currency-neutral basis.
  • 2NIKE Direct revenues decreased 4% on a reported basis and 7% on a currency-neutral basis, primarily due to reduced traffic.
  • 3Gross margin declined by 130 basis points to 40.2% in the third quarter, largely due to higher tariffs in North America.
  • 4Net income for the third quarter fell 35% to $520 million, with diluted EPS at $0.35.
  • 5The company incurred $230 million in pre-tax charges related to employee severance costs in the third quarter.
  • 6Inventories remained flat at $7.5 billion as of February 28, 2026.
  • 7NIKE returned approximately $609 million to shareholders through dividends in the third quarter.

Frequently Asked Questions

The primary driver for the decrease in gross margin by 130 basis points to 40.2% in the third quarter of fiscal 2026 was higher tariffs in North America, contributing to an approximate 270 basis point decrease in NIKE Brand product costs. This was partially offset by higher average selling prices and lower inventory obsolescence reserves.

NIKE Direct revenues decreased by 4% on a reported basis (7% currency-neutral) to $4.5 billion in the third quarter. This decline was primarily attributed to reduced traffic on the NIKE Brand Digital platform, which saw a 9% decrease in sales, and a 5% decrease in NIKE store sales.

NIKE is implementing strategic initiatives focused on product innovation, marketplace management (repositioning NIKE Brand Digital as a full-price platform and reinvesting in wholesale), and brand management. While these actions are expected to reignite brand momentum and drive long-term shareholder value, they have had a near-term negative impact on revenues and profitability. This is evident in the decline in NIKE Direct sales and the gross margin contraction, driven partly by inventory liquidation strategies including increased markdowns and returns.

The Greater China segment experienced a 10% revenue decrease (currency-neutral) in the third quarter. The company expects negative impacts from this region to continue throughout fiscal year 2027, citing declining store traffic, elevated promotional activity, and higher inventory levels as contributing factors.