Nike quarterly sales beat forecast amid "middle innings" of comeback

Nike Inc on Thursday reported a decrease in second-quarter profit, as the company said it remained confident in its turnaround plan.

Shares in the Beaverton, Oregon-based athletic brand traded 4.9% lower in extended trade on Wednesday in New York, having earlier closed down 0.2% at USD65.63.

In the second quarter ended November 30 net income declined 32% to USD792 million from USD1.16 billion a year prior. Diluted earnings per share declined to USD0.53 from USD0.78, ahead of the USD0.38 LSEG-compiled consensus.

Gross margin decreased 300 basis points to 40.6%, primarily due to higher tariffs in North America. Selling and administrative expenses rose 1% to USD4.0 billion.

Chief Executive Officer Elliott Hill said the company was in "the middle innings" of its comeback and remains confident in its 'Win Now' turnaround plan.

Hill added: "Fiscal 26 continues to be a year of taking action through Win Now, including realigning our teams, strengthening partner relationships, rebalancing our portfolio, and winning on the ground.

"We're finding our rhythm in our new sport offence, and setting ourselves up for the next phase of athlete-centred innovation in an elevated and integrated marketplace."

First quarter revenue firmed 1% to USD12.43 billion from USD12.35 billion, ahead of the USD12.22 billion expected.

Of total revenue, NIKE Brand was USD12.1 billion, up 1% reported, primarily due to growth in North America that was partially offset by declines in Greater China and APLA.

Nike Direct was USD4.6 billion, down 8% reported due to a 14% decline in Nike Brand Digital and a 3% decrease in Nike-owned stores.

Converse revenue declined to USD300 million, down 30% on a reported basis due to declines across all territories.

Chief Financial Officer Matthew Friend said: "In the second quarter, we demonstrated the resilience of our portfolio, delivering modest top-line reported growth while managing headwinds from repositioning our business in a dynamic operating environment.

"We are making the shifts required to position our portfolio for a full recovery and driving real-time decisions in service of the long-term health of our brands."

The company did not provide guidance in its report.