Nike guides lower, shares plunge

Nike just took a major hit—shares plummeted 15.5% after the company warned revenue will fall 2% to 4% not just next quarter, but into 2026. At the heart of the drop: a painful “cleanup” in China, where sales are set to crater 20% as Nike pulls its products from discount-heavy shops to protect brand image. Meanwhile, disruptions in Europe and the Middle East are piling up inventory, raising the risk of deeper markdowns. The question isn’t just whether Nike can stabilize sales, but if it can do so without giving up ground to rivals like Adidas and New Balance.

But here’s the catch: Nike insists there’s a margin fix on the horizon. CFO Matthew Friend says heavy tariff-related costs should finally ease by next summer, which could help shore up profits—if inventory and discounting don’t get out of control first. Leadership is feeling the heat, with internal memos promising more transparency and tighter cost management, but there’s growing tension between the need to cut spending and the risk of starving the product pipeline.

Reporting includes insights from Bloomberg and Fox Business, with internal notes from Nike leadership shaping what could be a pivotal reset—or a stumble that lingers well past this year’s holiday season.

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