Analysts Cautious About Nike Ahead of Q4 Earnings Report Next Week

Analysts are skeptical about Nike’s potential to show improvement in the short term. Ahead of the company’s fourth quarter earnings report next week, analysts noted that sales trends for the Swoosh could remain challenged through the remainder of the fiscal year — and potentially beyond that.

In its third quarter reported in March, the athletic giant reported revenues of $12.4 billion, ahead of the $12.28 billion expected. Net income was down 5 percent to $1.2 billion and diluted earnings per share was 77 cents, which included 21 cents per share of restructuring charges. This was ahead of the 74 cents expected by analysts. Nike said at the time it expected Q4 revenue to be up slightly and for full year revenue to be up 1 percent compared to the prior year.

In a Wednesday note, Williams Trading analyst Sam Poser cautioned investors to not “expect Nike to get itself out of its current doldrums as it has when it faced challenges in the past.” The analyst highlighted persistent issues, such as inexperienced C-suite leaders, layoffs, a shift to a push model, weaker sell-through rates and increased promotions. He also noted Nike’s continued share loss in the running category to brands like Asics, Brooks, Hoka, New Balance, On and Saucony.

“If Nike is to get out of its own way, it won’t happen until calendar 2026, in our view, if it does at all,” Poser said, adding that a change in leadership could help “right the ship.”

Market watchers have recently become increasingly skeptical of Nike’s performance as it continues to lose share in crucial categories like running. In December, Nike announced new measures to “streamline” its organization to save up to $2 billion in costs over the next three years by implementing layoffs, simplifying product and increasing automation. Nike also announced a new innovation pipeline after it was criticized for its lack of innovative products.

However, some analysts said Nike’s newest product introductions are still not making the cut.

Drake MacFarlane, a research analyst at M Science, observed in a June 12 note to investors that sales trends for Nike’s Air Force 1, Air Max, Dunk, and Jordan lines all saw declines in Q4. He added that the launch of the Air Max Dn in late March “did not appear impactful in April and May, with observed spending levels tracking well below their initial release in late March.”

“Although we still see positive trends for smaller lines like the Court, Killshot, V2K, and Vomero, these trends are more than offset by observed degradation in the broader product suite,” MacFarlane said.

UBS analyst Jay Sole highlighted similar trends in June 18 note.

“Our channel checks suggest Nike’s global sales growth trend remains weak,” Sole said. He added that he does not expect to see new innovation in the first half of 2025.