Nike shares tumbled after a dismal revenue forecast and new layoff plans, as the sneaker giant loses ground to rivals and struggles with China declines.
Nike shares tumbled 6.7% Friday after the company posted weaker first-quarter results and warned of more job cuts ahead, the New York Post reported. The stock later pared losses to close down 4% at $33.87, its second straight day of declines, and is down 47% so far this year.
On Thursday, Nike said first-quarter revenues slumped 4% to $11.2 billion. Net income came in at $712 million, down 2% from $727 million a year earlier. Management now expects revenue to fall by high-single digits in fiscal year 2027.
That outlook landed hard on investors already watching the brand lose altitude. Nike remains the largest sports company by scale, yet rising competitors and soft demand in key markets have chipped away at its edge.
CEO Elliott Hill rolled out a new operating model called “Pace,” built to cut costs, modernize the global supply chain, and reorganize the company into three geographic groups: the Americas, Asia Pacific and Greater China, and Europe, Middle East and Africa. The plan is expected to deliver $2.5 billion in cost savings by 2031. It will also mean fewer jobs.
In a Thursday note to employees, Hill did not hide the human cost. “This work will result in fewer roles across Nike, and I want to acknowledge that news like this creates uncertainty. I don’t take that lightly,” he wrote.
He added that the company would “communicate directly, act with transparency and treat people with respect,” and that decisions on impacted roles would begin in calendar year 2027 and beyond. Nike did not say how many jobs would go.
This is not the first round of cuts. In January the company eliminated 775 jobs at a U.S. distribution center. In April it cut another 1,400 roles from the tech division. The latest warning continues a pattern already familiar to workers and shareholders tracking Nike’s repeated job reductions.
Hill pointed to clear trouble spots. “We have more work to do in NIKE Sportswear, Jordan Brand and Greater China, and we’re taking deliberate actions to strengthen those businesses the right way for the long-term,” he said in a statement.
Revenue declines in Greater China were only partially offset by gains in North America. That imbalance has become a recurring drag. Soft demand in China has weighed on results even as the company tries to hold share at home, a pressure point covered in earlier reporting on China’s deepening sales slide.
The China problem sits inside a broader competitive squeeze. Nike still owns the Michael Jordan legacy that began with Air Jordans in 1985, when the company expected to sell about 100,000 pairs in the first year and instead moved 4 million. That kind of cultural lock is harder to keep when younger athletes and shoppers have more choices.
Management is scheduled to give more detail on its five-year outlook at an investor presentation on Nov. 16 and 17. Until then, the market is pricing in a slower brand and a thinner payroll.
The talent drain is no longer theoretical. A few weeks ago, Madrid striker Kylian Mbappé ended a two-decade partnership with Nike and left for Swiss rival On. On announced him as an ambassador the same day as it pushed into soccer. Global soccer stars Lamine Yamal, Harry Kane, and Ousmane Dembélé have also cut ties with Nike.
On launched in 2010 as a running brand. In 2020, tennis star Roger Federer, another former Nike partner, helped it introduce its first tennis-inspired shoe. Brands such as Hoka, Arc’teryx, and New Balance are also gaining ground. The once-clear hierarchy at the top of sportswear is no longer automatic.
Nike is still opening a new campus in Bengaluru, India, saying it will “strengthen how we serve athletes around the world, including in India.” Growth bets continue even as headcount and guidance shrink. That mix of expansion talk and layoff warnings is the kind of split signal that keeps Wall Street wary, consistent with coverage of analysts cutting Nike forecasts.
Last month Nike left the S&P 100 after 18 years. The index exit followed a steep multi-year drawdown and underscored how far the stock has fallen from its peak standing. That removal was already a public marker of lost altitude, as detailed when Nike was dropped from the S&P 100.
Friday’s drop extended the same story. A company that once set the pace in sneakers and apparel is now promising cost savings out to 2031 while telling investors near-term revenue will shrink. The Pace model may modernize operations. It does not reverse the sales miss or the athlete departures already on the record.
Investors who watched the stock fall nearly half this year now face another stretch of lower guidance, fewer roles, and open questions about Sportswear, Jordan Brand, and Greater China. Nike still has scale and history. What it no longer has is the easy assumption that it will stay on top without a fight.
Markets do not owe any brand a permanent pedestal. When sales slip, stars leave, and China turns soft, the share price delivers the grade.