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Call sheet · Q1'27

NIKE (NKE)

Q1'27 earnings call · held October 1, 2026 · compared with the Q4'26 call · management-credibility review
6/12
Disclosure score
2 high, 2 medium, 2 low flags
Financial quality
Bottom line
The sleeper story isn't that China cratered to -26% or that Sportswear and Jordan are bleeding, those are the obvious headlines everyone will write up tonight. It's that NIKE simultaneously stopped disclosing regional EBIT, channel mix, and inventory levels the exact quarter a new CFO took over and China guidance flipped from 'in line with recent performance' to an explicit admission it 'actually gets worse'. The binding constraint here isn't demand, it's visibility: management itself won't commit to gross margin guidance for the year and is pushing the real financial algorithm out to a November Investor Day, buying five weeks before having to defend a number. The most revealing line of the call was the new CFO's own framing: 'today's outlook should be viewed as our initial assessment', which is corporate-speak for 'don't hold us to this yet.' My view changes if regional EBIT and channel disclosure reappear next quarter and China's decline rate actually decelerates from -26%; if instead disclosure stays thin and China guidance gets cut again, this is a multi-year reset, not a one-quarter transition.

The 30-second version

  • The real story isn't China down 26%, it's that an entire layer of disclosure just disappeared
  • Guidance was cut to high-single-digit revenue decline for FY27, but the real binder is the multi-year Pace bridge to nowhere
  • China was promised to be 'in line with recent performance' last quarter; instead it's the worst number in the portfolio and management now says it gets worse from here

What changed this quarter

MetricQ4'26Q1'27Change
Total Revenue (reported YoY)Q4 FY26: down 1% reported, down 4% CCQ1 FY27: $11.2B, down 4% reported, down 5% CCDeceleration continues, reported decline doubled sequentially
EPS (GAAP)Q4 FY26: $0.72 reported / $0.20 ex-tariff benefitQ1 FY27: $0.48, down 2%Apples-to-oranges due to tariff one-timer, but underlying trend still negative
Gross MarginQ4 FY26: 49.2% reported (40.2% ex-900bps tariff benefit, down 10bps)Q1 FY27: 42.8%, up 60bps YoYUnderlying GM actually inflected positive as guided
SG&A (reported YoY)Q4 FY26: down 2% reportedQ1 FY27: down 3%Discipline intact, beat the 'flat' Q1 guide
Greater China RevenueQ4 FY26: -7%Q1 FY27: -26%Massive acceleration of decline, far worse than 'in line with recent performance' promise
EMEA RevenueQ4 FY26: -6%Q1 FY27: -5%Marginal improvement, but Q2 has explicit 400bps headwind coming
North America RevenueQ4 FY26: +3%Q1 FY27: +2%Still the bright spot, decelerating slightly
NIKE Performance Segment GrowthFY26 full year: mid-single digits, grew to $16BQ1 FY27: high-single digits (low-double digits ex-China)Accelerating, but World Cup-aided; still not big enough to offset Sportswear/Jordan/China
FY27 Revenue GuideQ4-Q2 FY27 cumulative window: down low-to-mid single digitsFull FY27: down high-single digitsMaterially worse guide than the window given last quarter
FY27 EBIT GuideFlattish earnings over Q4 FY26-Q2 FY27 windowEBIT to decline by a greater % than revenueReversal from flattish to deleveraging

Accountability tracked

7 new promises made5 narrative shifts flagged7 prior promises scored
Inside the full report
The complete write-up covers the full promise ledger with kept/missed calls, disclosure-quality scoring, the metrics-vanished check, verification items, and the questions to ask next quarter.
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Scores, kept-promise rates, and flags on this site reflect the author's opinion, applying a stated methodology to statements management made on public earnings calls. Informational and educational purposes only - not investment advice, a recommendation, or an offer to buy or sell any security. Sources believed reliable but not guaranteed; the author may hold positions in the securities discussed.

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