Nike’s turnaround hit another bump on October 1. For the first quarter of its 2027 fiscal year, which ended August 31, 2026, the company reported revenue of $11.2 billion, down 4% on a reported basis and down 5% on a currency-neutral basis.
Where the sales went
The decline was broad. Nike Direct, the stores and websites Nike runs itself, fell 8% to $4.1 billion. Within that, digital sales dropped 13% and Nike-owned stores 5%. Wholesale held up better, slipping 1% to $6.8 billion. Converse had the worst quarter of any unit: revenue fell 28% to $263 million.
By region, North America was the only market to grow, up 2%. Europe, the Middle East and Africa fell 5%, and Greater China fell 22%, according to Retail Dive and Marathon Handbook.
Profitability looked better than sales:
| Metric | Q1 fiscal 2027 | Change |
|---|---|---|
| Revenue | $11.2bn | −4% |
| Gross margin | 42.8% | +60 bp |
| Net income | $0.7bn | −2% |
| Diluted EPS | $0.48 | — |
| Inventories | $7.8bn | −3% |
| Dividends paid | ~$610m | +3% |
A weaker year ahead
The guidance hurt the stock most. Nike now expects full-year revenue to decline by a high-single-digit percentage, with adjusted diluted earnings per share of $1.15 to $1.35. Before the report, the shares had already lost about 43% since January, and they closed at $35.15 on October 1, according to Marathon Handbook.
The Pace plan: $2.5 billion and fewer jobs
Alongside the results, Nike announced a new operating model called Pace:
- The company is regrouping from four regions into three: Americas, APGC (Asia Pacific and Greater China) and EMEA.
- APGC leadership is moving to Singapore.
- Nike is opening a new campus in Bengaluru, India.
- The supply chain will move to a more variable cost structure.
CEO Elliott Hill said the changes “will result in fewer roles across Nike.” Decisions on job cuts will start in calendar 2027, and Nike says it does not yet know how many roles or which locations will be affected.
Marathon Handbook reports these figures for the plan:
- $2.5 billion in savings by fiscal 2031
- about $1 billion in pre-tax charges
- about $300 million in severance costs this fiscal year, on top of roughly $300 million booked last year
Nike will give more detail at an Investor Day on November 16–17, 2026.
Running is the exception
Running is the one category where the turnaround already shows. As reported by Marathon Handbook, Nike says:
- Running has posted five consecutive quarters of double-digit growth.
- That growth added roughly $1 billion in sales.
- Nike gained five points of running market share in North America and Western Europe last fiscal year.
Retail Dive also lists running, training and basketball among the categories showing early signs of recovery.
“We know what healthy looks like and we’re taking deliberate actions to get there,” Hill said.
Sources
- Nike: NIKE, Inc. Reports Fiscal 2027 First Quarter Results
- Nike: NIKE, Inc. Corporate Announcement, October 1, 2026
- Retail Dive: Nike extends turnaround timeline amid more layoffs, sales declines
- Marathon Handbook: Nike Sales Fall 4 Percent As It Unveils The Pace Plan
This article was written with AI by the Hopone Newsroom, from the sources it cites. Figures marked “Hopone calculation” are our own arithmetic from those sources. Nothing here is investment advice.