Nike’s stock plummeted 10% despite beating earnings estimates, reporting $12.4 billion in revenue and $0.53 earnings per share for Q2 2026. However, net income fell 32%, gross margins shrank, and Chinese sales dropped 17%. Nike projects continued challenges next quarter with tariffs and competition.

Nike’s direct-to-consumer sales declined 8%, with digital sales dropping even more, signaling consumer hesitation. China sales fell 17%, contributing to a multi-quarter slump. Nike projects further revenue decline and margin pressure. Leadership aims to reassure investors by framing the challenges as part of a broader turnaround strategy.

CEO Elliott Hill and CFO Matthew Friend emphasize efforts to rebalance the portfolio and strengthen partnerships. Despite beating estimates, Nike still faces challenges in its direct-to-consumer business and Chinese market. Analysts debate whether this is a temporary setback or a sign of a slower recovery.

Read more at Yahoo Finance.: Nike earnings show it’s losing China. The stock falls 10%