The worst expert forecasts have not materialised, as Nike’s Q4 2025 financial report signals the end of a challenging restructuring phase and the beginning of the company’s recovery. NKE shares are rising in value.
Nike, Inc. (NYSE: NKE) reported its Q4 2025 financial results, showing revenue had fallen by 12% to 11.1 billion USD and earnings per share had dropped by 86% to 0.14 USD. However, the results surpassed lowered expectations, indicating initial success in implementing its transformation strategy. The company focused on executing its Win Now plan, which included eliminating excess inventory, reducing discount volumes, and shifting its focus to key sports product lines.
The main challenges during the quarter were linked to weakening demand in China, a decline in digital sales, and pressure on gross margin caused by tariffs and changes in product mix. Despite these constraints, investor reaction was positive – Nike shares rose by more than 14% following the report, as market participants saw signs of stabilisation and potential recovery.
Nike’s management issued guidance for Q1 2026, forecasting a more moderate revenue decline, which strengthened confidence that the most challenging phase of the company’s restructuring has been successfully overcome.
This article reviews Nike, Inc., outlines its key revenue streams, summarises Nike’s financial performance in Q3 and Q4 2025, and reveals expectations for Q1 2026. Additionally, a technical analysis of NKE is provided, forming the basis for the Nike stock forecast for the 2025 calendar year.
About Nike, Inc.
Nike, Inc. is a US-based company founded on 25 January 1964 by Phil Knight and Bill Bowerman under the name Blue Ribbon Sports before rebranding as Nike in 1971. The company designs, manufactures, markets, and sells athletic footwear, apparel, accessories, and equipment. Its primary business segment is athletic footwear, which generates the majority of its revenue. Nike produces goods for a variety of sports, including running, basketball, football, tennis, golf, and fitness.
The company was listed on the NYSE on 2 December 1980 under the ticker symbol NKE.
Image of the Nike, Inc. company name
Nike, Inc.’s main revenue streams
Nike’s revenue is generated from various sources within its business operations, with a primary focus on key areas such as footwear, apparel, and equipment, as well as brand licensing and digital platforms. Nike’s main revenue streams are outlined below:
- Footwear sales: Nike’s largest source of revenue is footwear, including athletic sneakers, casual shoes, and specialised models for running, basketball, and fitness. In Q3 fiscal 2025, footwear remained the dominant category; however, quarterly data shows a revenue decline in this segment, highlighting challenges linked to excess inventory and competitive pressures
- Apparel sales: this category encompasses sports and casual apparel, including T-shirts, shorts, tank tops, and outerwear. Apparel complements Nike’s footwear range and is a significant revenue stream, often related to seasonal demand and collaborations with sports companies
- Sports equipment sales: Nike generates revenue from sports equipment, including bags, socks, gloves, and accessories. While smaller than the footwear and apparel segments, this category plays a supporting role in the brand’s ecosystem
- Nike Direct: revenue from direct-to-consumer sales – including Nike’s website, mobile app, and physical stores – falls under the Nike Direct segment. This channel prioritises direct sales to consumers, bypassing wholesalers. Digital sales remain a key focus for Nike, with continued investment in e-commerce
Nike, Inc. Q3 FY2025 report
On 20 March, Nike released its earnings report for Q3 of fiscal year 2025, which ended on 28 February. Below are the key financial figures compared to the same period last year:
- Revenue: 11.27 billion USD (-9%)
- Net income: 0.79 billion USD (-32%)
- Earnings per share: 0.54 USD (-30%)
- Gross margin: 41.5% (-330 basis points)
Revenue by country:
- North America: 4.86 billion USD (-4%)
- Europe, Middle East, and Africa: 2.81 billion USD (-10%)
- Greater China: 1.73 billion USD (-17%)
- Asia Pacific and Latin America: 1.47 billion USD (-11%)
The company’s management attributed a 9% decline in revenue to a double-digit drop in sales in January and February, following a successful holiday season in December. China experienced the most significant slump, with sales falling by 17%. Despite growth in the workout and running apparel categories, Nike noted a decline in the sports style and Jordan brand segments, particularly in its classic footwear lines.
Nike’s management forecast a substantial revenue decline of 13.0-15.0% in Q4 of fiscal year 2025, ending on 31 May 2025, which exceeded analysts’ forecasts of 11.4-12.2%. The outlook reflected efforts to liquidate excess inventory and refresh outdated product lines amid external factors such as tariffs and economic uncertainty.
CFO Matthew Friend expected gross margin to decrease by 4-5 percentage points due to the active sell-off of old inventory and the introduction of new, innovative models, noting that Q4 fiscal 2025 would be the period with the most significant impact from these measures, after which pressure on revenue and margins was expected to ease in fiscal 2026.
Overall, Nike’s management described the quarter as a period of progress amid ongoing challenges, exceeding income expectations while continuing to face pressure on revenue and margins. For the upcoming quarter, they forecast a more substantial decline in sales and margins as part of a strategic business relaunch, with hopes for improvements in the fiscal year 2026.
Nike, Inc. Q4 2025 financial report
- Revenue: 11.10 billion USD (-12%)
- Net profit: 0.21 billion USD (-86%)
- Earnings per share: 0.14 USD (-86%)
- Gross margin: 40.3% (-440 basis points)
Revenue by country:
- North America: 4.70 billion USD (-11%)
- Europe, Middle East & Africa: 3.00 billion USD (-9%)
- Greater China: 1.48 billion USD (-21%)
- Asia Pacific & Latin America: 1.58 billion USD (-8%)
Nike’s Q4 2025 report marked a transitional phase in the company’s strategy. Despite weak financial results, management expressed confidence about the start of a recovery cycle. Revenue declined by 12% to 11.1 billion USD, and earnings per share fell 86% to 0.14 USD. However, both figures exceeded market expectations and were positively received by investors.
Management described the quarter as the bottoming-out point in the execution of the Win Now transformation program. Inventory levels continue to decline, aggressive discounting is being reduced, and the product portfolio has been reshaped with a focus on core sports categories. Under the leadership of new CEO Elliott Hill, steps are being taken to strengthen the brand’s position in key segments and to reallocate internal resources.
The market responded to the report with a 14% rise in Nike shares. Analysts at JPMorgan, HSBC, Jefferies, and other investment houses raised their price targets, citing signs of a sustainable business turnaround.
For Q1 2026, Nike forecasts a mid-single-digit percentage decline in revenue, representing an improvement over previous market estimates. At the same time, the company expects gross margin compression of 350-425 basis points, driven by tariff costs and changes in sales mix. CFO Matt Friend stated that Nike is prepared to offset up to 1 billion USD in additional tariffs by shifting some production out of China and implementing moderate price increases in the US starting this autumn.
The restructuring strategy includes personnel changes, refocusing on key product lines, optimising sales channels, and returning to a more sustainable distributor engagement model. Stabilisation of inventory levels (at approximately 7.5 billion USD) and increased interest in new collections confirm positive momentum.
Despite ongoing revenue pressures in several regions (notably an 11% decline in North America and 21% in China), the company is laying the groundwork for a gradual recovery in operational efficiency. In the context of mitigating external risks and successfully executing planned initiatives, Nike’s medium-term outlook for share price growth is positive.
Expert forecasts for Nike, Inc. stock
- Barchart: 15 out of 36 analysts rated Nike stock as Strong Buy, three as Moderate Buy, 16 as Hold, and two as Strong Sell. The highest target price for share appreciation is 120 USD, and the lowest target for a sell recommendation is 40 USD
- MarketBeat: 17 out of 30 experts assigned a Buy rating, and 13 recommended Hold. The highest target price for upside potential is 115 USD
- TipRanks: 16 out of 29 surveyed analysts rated the stock as Buy, and 13 as Hold. The highest target price is 120 USD
- Stock Analysis: eight out of 29 experts rated the Nike stock as Strong Buy, seven as Buy, and 14 as Hold. The highest price target is 120 USD
Expert forecasts for Nike, Inc. stock for 2025
Nike, Inc. stock price forecast for 2025
On the weekly timeframe, Nike stock has been trading within a downward channel since November 2021. However, a bullish divergence has formed on the MACD indicator, signalling a potential price increase with a breakout above the descending trendline. Based on the current performance of Nike shares, the possible scenarios for NKE’s price movements in 2025 are as follows:
The base-case forecast for Nike stock anticipates a test of support at 65 USD, followed by a rebound and an upward move towards the trendline near 80 USD. Should the trendline be broken, NKE’s share price could rise to the next resistance level at 100 USD. Supporting this scenario is Nike management’s updated guidance for Q1 FY2026, which signals that the most challenging phase of restructuring has been completed and a recovery is underway.
The alternative forecast for Nike shares projects a decline in NKE’s share price towards the support level at 52 USD. A rebound from this level could act as a catalyst for renewed growth. If resistance at 70 USD is breached, a double-bottom pattern would form on the chart – a classic reversal signal indicating the end of a downtrend and the beginning of a sustained upward move. In this scenario, the key target would be the resistance zone around 100 USD.
Nike, Inc. stock analysis and forecast for 2025
Risks of investing in Nike, Inc. stock
When investing in Nike, it is essential to consider the risks that may negatively impact the company’s income and affect its investors. The main risks are outlined below:
- The impact of tariffs on profit margins: Nike has warned that higher tariffs on imports from China and Mexico could significantly reduce profit margins
- Competition and loss of market share: Nike faces intense competition from brands such as New Balance and Adidas, which are strengthening their positions, particularly in casual footwear and retro model segments. This poses a threat to Nike’s market share
- Economic instability: factors such as inflation, recession fears, and reduced purchasing power may lead to decreased consumer spending on sportswear and footwear, ultimately impacting Nike’s revenues