Nike (NKE) is set to report fiscal first-quarter results Tuesday after market close, with Wall Street bracing for a sharp profit decline as the sneaker giant navigates heavy tariff headwinds and a sweeping turnaround strategy under CEO Elliott Hill.<\/p>\n\n\n\n
Analysts expect adjusted earnings per share of $0.28, a steep 60% drop from the same period last year, while revenue is projected to fall 4.9% to $11.02 billion, according to Bloomberg data. Nike Direct, its direct-to-consumer business, is forecasted to decline 8.3% to $4.3 billion, while wholesale revenue is also expected to contract nearly 8% to $6.28 billion.<\/p>\n\n\n\n
The company\u2019s namesake brand is projected to see sales down 5% to $10.55 billion, while Converse revenue could fall 9% to $456 million. These losses would still mark modest improvements from steeper declines reported in the prior quarter.<\/p>\n\n\n\n
\u201cNike is making the right moves by cleaning up inventory, increasing newness, and strengthening wholesale relationships,\u201d said Telsey Advisory Group analyst Cristina Fern\u00e1ndez. \u201cHowever, the brand still seems a few quarters away from reaching stabilization.\u201d<\/p>\n\n\n\n
Tariffs remain a significant drag. CFO Matthew Friend previously estimated gross incremental costs at $1 billion, but rising levies on imports from Vietnam, Cambodia, and Indonesia could push the impact closer to $1.5 billion. Nike projects gross margins to fall by 350\u2013425 basis points, with about 100 tied directly to tariffs.<\/p>\n\n\n\n
Nike is working to reduce its reliance on China, which currently supplies 16% of U.S.-bound shoes, targeting a cut to the high-single digits by year\u2019s end. A \u201csurgical price increase\u201d in the U.S. is also planned for this fall.<\/p>\n\n\n\n
Despite these challenges, analysts note that product innovation\u2014including the launch of NikeSKIMS\u2014and inventory discipline could help Nike recover momentum ahead of major global events like the 2026 World Cup.<\/p>\n\n\n\n