Greater China remains a cornerstone of NIKE Inc.’s NKE long-term growth story. This makes the region’s 10% revenue decline in first-quarter fiscal 2026 a significant setback for the brand. The region saw a double-digit dip across NIKE Direct and digital, while wholesale slid 9%, reflecting softer traffic, elevated promotions, and underperforming seasonal sell-through.
However, management stressed China’s strategic importance, noting strong local passion for basketball, football and running, and highlighting bright spots such as high single-digit growth in running, supported by innovations like the Peg Premium and Vomero 18. Although the quarter underscores China’s structural challenges, NIKE reiterated its commitment to rebuilding momentum through sport-led retail refreshes and deeper local relevance.
Beyond China, NIKE’s global playbook continued to take shape, driven by its “Win Now” actions and the rollout of its new Sport Offense operating model. North America led the recovery with 4% revenue growth, bolstered by double-digit gains in running, training and basketball, and strengthened wholesale relationships. EMEA and APLA delivered modest top-line progress, though both regions faced pockets of heightened promotional activity and softer digital demand.
The company emphasized that the Sport Offense, organizing teams by sport, brand and channel, is already producing clearer consumer insights, faster innovation cycles, and more immersive retail experiences, including refreshed House of Innovation formats that have driven double-digit revenue lifts.
Looking ahead, NIKE is counting on a more globally synchronized product engine, sharper storytelling around key sports moments and improved marketplace health to create balance across geographies. Management acknowledged a dynamic consumer environment, tariff-driven cost pressures and uneven recovery timelines, particularly in China and NIKE Digital. Even so, a stronger innovation pipeline, growing wholesale order books, and sport-driven brand activations underpin NIKE’s confidence that its global playbook can offset regional weakness and restore consistent, profitable growth over time.
How NKE’s Peers LULU & ADDYY Are Performing Globally
As NIKE navigates a mixed global backdrop, investors are closely watching how peers like lululemon athletica inc. LULU and adidas AG ADDYY are performing across key markets.
lululemon delivered another strong quarter in China, with Mainland revenue up 25% and comparable sales rising 16% in second-quarter fiscal 2025, supported by store expansion and high-impact brand activations like its summer sweat games. This strength highlights the resilience of its international strategy, even as the U.S. remains pressured. Globally, LULU continues to expand into new markets and build awareness, but its playbook is not fully balanced yet, given the contrast between robust international momentum and softer North American trends.
adidas delivered 10% growth in Greater China in third-quarter 2025, supported by strong DTC momentum and renewed demand across both Performance and Lifestyle categories. This regional strength fits into its globally consistent playbook, which emphasizes local relevance, deeper product ranges, and sport-led storytelling. With double-digit gains across all major markets, adidas’ global strategy appears well balanced, showing broad-based traction rather than reliance on any single region.
NKE’s Price Performance, Valuation & Estimates
Shares of NIKE have lost 14.4% year to date compared with the industry’s decline of 17.1%.
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From a valuation standpoint, NKE trades at a forward price-to-earnings ratio of 30.99X compared with the industry’s average of 26.74X.
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The Zacks Consensus Estimate for NKE’s fiscal 2026 earnings implies a year-over-year decline of 24.1%, while that for fiscal 2027 indicates growth of 54.2%. Earnings estimates for fiscal 2026 have been southbound in the past seven days. Meanwhile, the consensus estimate for fiscal 2027 has been northbound in the same period.
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NIKE stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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This article originally published on Zacks Investment Research (zacks.com).
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