Nike (NKE) Q3 2025 earnings summary

Executive summary

• Q3 revenues were $11.3B, down 9% year-over-year (7% currency-neutral), with declines across all geographies and channels; nine-month revenues were $35.2B, down 9% year-over-year.

• Net income for Q3 was $794M, a 32% decrease compared to last year; diluted EPS was $0.54, down 30%.

• Gross margin declined 330 basis points to 41.5%, mainly due to higher discounts, inventory obsolescence, and product costs.

• NIKE Direct revenues fell 12% year-over-year in Q3, with digital sales down 15% and comparable store sales down 3%.

• Management reaffirmed its second-half fiscal 2025 outlook, citing progress on 'Win Now' strategic priorities and focus on product innovation and brand momentum.

Financial highlights

• Q3 diluted EPS was $0.54, down 30% year-over-year; nine-month diluted EPS was $2.02, down 26%.

• EBIT margin for Q3 was 7.3% versus 10.9% last year; nine-month EBIT margin was 9.9% versus 12.6%.

• Inventories as of February 28, 2025, were $7.5B, down 2% year-over-year but flat compared to May 31, 2024.

• Cash and equivalents plus short-term investments totaled $10.4B at quarter-end, down $0.2B from last year.

• Returned $1.1B to shareholders in Q3 via dividends and share repurchases; 119.3M shares repurchased under the $18B program since June 2022, totaling $11.8B.

Outlook and guidance

• Management expects near-term revenue and gross margin pressure due to continued inventory liquidation, higher discounts, and investment in demand creation.

• Q4 revenues expected to decline in the mid-teens (low end), with gross margins down 400–500 basis points, including restructuring charges and new tariffs.

• SG&A for Q4 projected up low to mid-single digits; tax rate for the full year expected in the mid-teens.

• Headwinds to revenue and margin expected to moderate after Q4, but inventory liquidation and promotional activity will continue into fiscal 2026.

• Strategic actions are aimed at reigniting brand momentum and repositioning for long-term shareholder value.