NIKE, Inc. Q3 FY2025 earnings call

• Elliott Hill mentioned being proud of progress against key actions but not satisfied with overall results. He emphasized leading with sport creates impact, shared Win Now strategic priorities including igniting winning culture, shaping brand for distinction, accelerating complete product portfolio, elevating and growing marketplace, and winning on the ground. • Highlighted Super Bowl and NBA All-Star weekend brand activities, like NIKE's Super Bowl ad and Jordan Fam Fest. • Discussed product performance: running products like Pegasus Premium and Vomero 18 had strong sell-through; sportswear diversification with 24/7 collection and NIKESKIMS launch. • Talked about integrated marketplace efforts, including restoring sales organization and go-to-market processes, repositioning NIKE Digital as a full-price business, and working closely with wholesale partners.

For the quarter, revenues were down 9% on a reported basis and down 7% on a currency neutral basis. NIKE Direct was down 10% with NIKE Digital declining 15% and NIKE Stores declining 2%. Wholesale was down 4% largely due to declines in Greater China. Gross margins declined 330 basis points to 41.5% on a reported basis. SG&A was down 8% on a reported basis. Earnings per share was $0.54. By region: North America Q3 revenue declined 4%; EMEA Q3 revenue declined 6%; Greater China Q3 revenue declined 15%; APLA Q3 revenue declined 4%. Performance business grew in the quarter, led by training and running, but offset by declines in NIKE sportswear and Jordan brand due to classic footwear franchises.

• Fourth quarter revenues expected to be down in the mid-teens range, low end. • Q4 gross margins expected to be down approximately 400 basis points to 500 basis points. • Q4 SG&A dollars expected to be up low to mid-single digits. • Other income and expense expected to be $45 million to $55 million for Q4. • Full year tax rate expected to be in the mid-teens range. • Fourth quarter受Win Now actions影响最大，后续头风开始缓和，但受外部因素如地缘政治、关税、汇率等影响。

• Global economic uncertainty. • Geopolitical dynamics. • New tariffs. • Volatile foreign exchange rates. • Tax regulations. • Impact of these uncertainties and other macro factors on consumer confidence.

Q: Lorraine Hutchinson asked about the timeline for cleaning up classic shoe inventories in wholesale and direct channels.

A: Elliott Hill and Matt Friend responded, discussing Win Now actions, right sizing classic footwear franchises, inventory management in digital and wholesale channels, and progress in cleaning up inventories.

Q: Brooke Roach asked about innovation within NIKE and innovation in sportswear franchises.

A: Elliott Hill replied, talking about long-term innovation at NIKE Sports Research Lab, near-term innovation in performance and sportswear, and excitement about Spring 26 product review.

Q: Aneesha Sherman asked about inflection point for performance growth offsetting classic declines and gross margin progression.

A: Elliott Hill and Matt Friend answered, discussing confidence in product pipeline, impact of Win Now actions on Q4, and expectations for margin progression.

Q: Simeon Siegel asked about balancing promotions and clearing product, and overhead vs demand creation.

A: Elliott Hill and Matt Friend responded, talking about liquidating excess inventory through value channels, managing SG&A, and balancing overhead and demand creation.

Q: Alex Straton asked about balancing wholesale promotional and brand storytelling, and historical wholesale margins.

A: Elliott Hill and Matt Friend answered, discussing integrated marketplace approach, working closely with wholesale partners, and historical wholesale margin considerations.

Q: Randal Konik asked about progress in different geographies from Win Now strategies.

A: Elliott Hill and Matt Friend replied, talking about progress in various geographies, focus on China, and efforts to clean up marketplace and present new product stories.