Nike Inc - Class B

Nike delivered a better-than-expected bottom line in fiscal Q2 2025, but the headline beat did little to obscure the depth of the turnaround challenge facing new CEO Elliott Hill. The company posted diluted EPS of $0.78, clearing the $0.63 consensus estimate by 23.81%, yet that figure still represented a 24% decline from a year ago as net income tumbled 26% to $1.16 billion. Revenue of $12.35 billion fell 7.7% year over year, with broad weakness across every geography and channel; NIKE Direct was the sharpest drag, sliding 13% to $5.00 billion on the back of a steep 21% drop in digital sales. Gross margin contracted 100 basis points to 43.6%, squeezed by heavier discounting and unfavorable channel mix. Analysts have noted that the results, while above expectations, remain poor by Nike's historical standards and that increased discounting clouds the near-term profit outlook, suggesting the brand's repositioning under Hill, who is roughly 60 days into his tenure, will take time to bear fruit.