NIKE Reports Q3 Fiscal 2026 Results with Revenue of $11.3 Billion and Net Income Decline

NIKE, Inc. reported its financial results for the third quarter of fiscal 2026, revealing revenues of $11.3 billion, a slight increase from $11.27 billion in the same period last year. However, on a currency-neutral basis, revenues decreased by 3%. The company's net income for the quarter was $520 million, down 35% from $794 million a year earlier, resulting in diluted earnings per share of $0.35, compared to $0.54 in the prior year. For the first nine months of fiscal 2026, NIKE's revenues reached $35.4 billion, a 1% increase from $35.2 billion in the same period of fiscal 2025, while net income fell to $2.04 billion from $3.01 billion.

The company's gross profit for the third quarter was $4.53 billion, down from $4.68 billion a year ago, with a gross margin of 40.2%, reflecting a decrease of 130 basis points primarily due to higher tariffs in North America. Total selling and administrative expenses increased to $3.98 billion, up 2% from $3.89 billion in the previous year. The effective tax rate for the quarter was 20.0%, significantly higher than the 5.9% reported in the same quarter last year, largely due to a one-time deferred tax benefit recognized in the prior year.

In terms of operational developments, NIKE's wholesale revenues increased to $6.5 billion, up 5% year-over-year, while direct-to-consumer revenues decreased to $4.5 billion, down 4% from the previous year, primarily due to reduced traffic. The company reported a decline in customer engagement metrics, with comparable store sales decreasing by 5%. NIKE's inventory levels remained stable at $7.5 billion, reflecting an increase in units offset by product mix changes.

Strategically, NIKE is focusing on product management and marketplace management to drive growth. The company is repositioning its digital platform as a full-price channel and is investing in brand marketing to support key product launches. Additionally, NIKE has recognized pre-tax employee severance costs of $230 million in the third quarter, primarily related to organizational changes, and anticipates further actions that may lead to additional charges in the future.

Looking ahead, NIKE acknowledges the challenges posed by external factors such as geopolitical dynamics and fluctuating foreign currency exchange rates, which could impact consumer behavior and overall profitability. The company remains committed to driving long-term shareholder value through strategic initiatives aimed at enhancing brand momentum and operational efficiency.