Nike Stock Slumps 10% Amid Disappointing Q4 Forecast and China Market Challenges

TLDR

• Nike surpassed Q3 earnings and revenue projections, yet presented a more subdued Q4 forecast than anticipated.
• Sales for Q4 are projected to decline by 2%–4%, contrasting with Wall Street’s expectation of a 1.9% increase.
• Revenue from Greater China decreased by 7% to $1.62 billion, marking its seventh consecutive quarterly decline, with a further 20% reduction anticipated in the upcoming quarter.
• Gross margin decreased by 1.3 percentage points to 40.2%, impacted by increased tariffs in North America.
• Nike’s stock experienced a drop of over 9% in premarket trading on Wednesday, hovering around $47.88.

(SeaPRwire) –   Despite Nike reporting strong Q3 results on Tuesday, the market reacted negatively. Investors divested shares following the company’s release of a pessimistic sales forecast and its acknowledgment of ongoing challenges in China.

$NKE | Nike Q3’26 Earnings Highlights

Revenue: $11.28B (Est. $11.24B) FLAT YoY
EPS: $0.35 (Est. $0.31)
NIKE Brand Revenue: $11.01B (Est. $10.94B)
Gross Margin: 40.2% (Est. 39.8%)
Greater China EBIT: $467M (Est. $269.5M)
Inventory: $7.49B (Est.… pic.twitter.com/UqGgGtsq57I

— Wall St Engine (@wallstengine) March 31, 2026

Chief Financial Officer Matt Friend stated that Nike anticipates a 2% to 4% decline in Q4 sales. This contrasts with Wall Street’s previous projection of a 1.9% rise. For the entire calendar year, Nike now foresees sales decreasing by a low single-digit percentage.

Third-quarter earnings reached 35 cents per share, with revenue totaling $11.28 billion. Analysts had predicted earnings between 28–30 cents and revenue between $11.23–11.24 billion. While these figures represented a clear beat, the forward-looking guidance overshadowed the positive results.

NIKE, Inc., NKE

The company’s net income for the quarter decreased by 35% year-over-year, falling to $520 million from $794 million in the prior year. Gross margin saw a 1.3 percentage point reduction to 40.2%, primarily attributed by Nike to elevated tariffs in North America.

China Remains the Problem

Revenue from Greater China declined by 7% to $1.62 billion, signifying the seventh consecutive quarter of contraction. Nike is now preparing for a 20% decrease in this market during Q4. Given that the region contributes approximately 15% of Nike’s worldwide revenue, this figure cannot be easily dismissed by the market.

Adrienne Yih, an analyst at Barclays, highlighted that the primary insight was “the profound and gradual nature of a highly intentional Greater China reset, which will probably require four quarters to regain growth.” She further commented that the stock is “expected to trade within a defined range in the short term” but identified prices below $50 as an appealing entry point for investors with a longer horizon.

Nike is also experiencing a loss of market share in China to domestic competitors such as Anta and Li Ning, alongside increasing global competition from brands like On Running and Hoka.

North America demonstrated resilience. Revenue in the region increased by 3% to $5.03 billion, slightly below the $5.04 billion estimate. Wholesale revenue saw a 5% increase to $6.5 billion, whereas direct sales decreased by 4% to $4.5 billion — a trend consistent with CEO Elliott Hill’s intentional shift back towards wholesale partnerships.

Turnaround Still in Progress

Hill, who reassumed leadership of Nike at the close of 2024, has openly acknowledged that the turnaround will not be immediate. He stated on Tuesday that “the rate of advancement varies across the product portfolio.”

Friend additionally pointed out external risks, such as instability in the Middle East and escalating oil prices, which have the potential to impact both production expenses and consumer expenditure. He emphasized that Nike’s projections are based on prevailing conditions and are subject to change.

Nike’s stock has now declined by 15.8% in 2025 and has seen a further 17.1% decrease year-to-date. Shares listed in Frankfurt fell by 8.7% at the start of trading on Wednesday.

Analysts at Jefferies, under the leadership of Randal Konik, characterized Q3 as indicative of “consistent advancement,” citing improved inventory levels and growing momentum in North America and wholesale channels, though they conceded that China and Nike Digital continue to be “areas requiring attention.”