Nike posted $1.07 billion in net income during its fiscal Q4, versus $211 million in the same period last year. On an unadjusted basis, earnings per share came in at 72 cents, up from 14 cents. The main reason for this profit surge was a $986 million refund from tariffs that the U.S. Supreme Court ruled unconstitutional - overturning many of President Trump's global duties.
That refund alone added 52 cents to Nike's earnings per share. Gross margin surged by 8.9% thanks to that $986 million tariff refund after the Supreme Court invalidated several of Trump's global tariffs. As of the quarter's conclusion, Nike had taken in $300 million in cash from those tariff claims.
CEO Elliott Hill affirmed that Nike is "fully committed to winning" in the China market. But he also acknowledged that results are not good enough.
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"We know we're not living up to our full potential, particularly in Nike sportswear and Jordan streetwear, where sell through remains challenged, impacting both current discounting and future order books," Hill said.
CFO Matt Friend described Nike's consumer base as "under pressure around the world."
In North America, Nike's biggest region, revenue rose 3% to $4.83 billion. That was still a bit below the $4.88 billion analysts had predicted. For the full fiscal year 2026, Nike's net income was $3.11 billion, down slightly from $3.22 billion the year before.
Nike repeated its guidance that earnings will be "flattish" in the first two quarters of fiscal 2027, and it expects gross margin to be slightly positive in the first quarter. CEO Elliott Hill is using the upcoming World Cup in North America to reshape the brand, saying the company is treating the tournament as a platform to build momentum, not just a single event. Meanwhile, Nike cut 1,400 roles in a second round of layoffs in April 2026.
Nike also contends with risks stemming from trade tariffs, conflicts in the Middle East, and rising fuel costs. David Denton, a former Pfizer executive, will replace CFO Matt Friend on August 17.
The fiscal year 2026 results paint a mixed picture: net income of $3.11 billion fell slightly from $3.22 billion the prior year, while North American revenue managed a modest 3% gain. Nike's struggles in China - where sales dropped 12% - highlight the challenge of a consumer base under pressure and intensifying competition from local sportswear brands. The upcoming World Cup is seen as a key opportunity for brand reinvigoration, and Hill's cost-cutting measures, including the April layoffs, aim to improve efficiency. The leadership transition to new CFO David Denton adds another layer of change as Nike navigates tariff uncertainty, geopolitical tensions, and shifting consumer trends.
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