Nike shares drop as retailer posts disappointing sales, announces layoffs as part of restructuring

Nike on Thursday posted fiscal first quarter earnings that topped Wall Street's expectations, even as sales fell short of estimates.

The company also offered a full-year outlook, saying it expects revenues to decline by a high-single digit percentage in fiscal 2027.

Shares of Nike fell roughly 4% in extended trading Thursday.

Here's what the company reported for the period compared to what analysts expected, according to consensus estimates from LSEG:

Nike reported net income of $712 million, down 2% from $727 million the year prior.

Revenue fell 4% to $11.21 billion. The retailer said Nike brand revenues took a hit largely due to sustained declines in the China business. Revenue in the market dropped 26%

Its North America revenue came in at $5.13 billion, just above estimates of $5.11 billion, according to StreetAccount. Nike also reported gross margin of 42.8% compared to estimates of 42.4%.

The retailer has been in the midst of a turnaround plan, focused on improving separate parts of its business at different rates based on priority. The Nike consumer has also been under increased macroeconomic pressure as geopolitical tensions and higher inflation lead to slower spending.

Shares of Nike have plummeted more than 40% this year.