Nike’s turnaround is not yet established. Revenue stabilized in fiscal 2026 after a sharp decline, but fell again in fiscal 2027’s first quarter. Gross margin improved modestly over fiscal 2026 and year over year in the latest quarter, while inventory rose sequentially by August 2026. To judge whether progress is durable, compare like periods and look at what is driving each metric—not one headline number.
Start with comparable periods and the right definitions
Nike’s fiscal 2026 ended May 31, 2026. Fiscal 2027 Q1 ended August 31, 2026. Revenue and gross margin measure activity over a period; inventory is a balance on a particular date. Compare quarter with the same quarter a year earlier, and label inventory comparisons by their exact dates.
Nike reports revenue both as reported and on a currency-neutral basis. Currency-neutral comparisons apply prior-year exchange rates to remove the effect of foreign-exchange translation. The two measures can point in different directions, so use both when available. Nike describes the method in its investor earnings materials.
Is Nike revenue growing again?
The annual decline eased substantially, but the latest quarter returned to contraction. Nike reported fiscal 2025 revenue of $46.3 billion, down 10% as reported and 9% currency-neutral. Fiscal 2026 revenue was $46.4 billion, flat as reported but down 2% currency-neutral. In fiscal 2027 Q1, revenue was $11.2 billion, down 4% as reported and 5% currency-neutral year over year. Those figures are in Nike’s fiscal-year results and Q1 fiscal 2027 release.
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Flat reported annual revenue is a stabilization signal, not proof of renewed growth: the currency-neutral result was still negative, and the following quarter declined on both bases. A stronger signal would be sustained growth across consecutive comparable quarters.
Separate wholesale from NIKE Direct
Fiscal 2026’s channels moved in opposite directions. Wholesale revenue rose to $27.5 billion from $25.9 billion in fiscal 2025, up 4% currency-neutral. NIKE Direct fell to $17.7 billion from $18.8 billion, down 8% currency-neutral. In fiscal 2027 Q1, wholesale was $6.8 billion, down 1% currency-neutral; NIKE Direct was $4.1 billion, down 9%, while Digital sales declined 13% currency-neutral. Wholesale helped the annual comparison, but it was not growing in the latest quarter.
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Look beneath the consolidated total
Fiscal 2027 Q1 performance varied considerably by geography and brand. North America revenue rose 2% currency-neutral, with wholesale up 9% and NIKE Direct down 6%. EMEA declined 5%, Greater China declined 26%, and Converse declined 28%, all currency-neutral. Nike said negative impacts from Greater China and Converse were expected to continue throughout fiscal 2027. A recovery concentrated in one region or channel would therefore be less persuasive than improvement broadening across the business.
Are Nike’s margins recovering?
Gross margin fell 190 basis points in fiscal 2025 to 42.7%, with Nike citing higher discounts, channel-mix changes, and higher inventory-obsolescence reserves, partly offset by lower product costs. It rose 20 basis points in fiscal 2026 to 42.9%. In fiscal 2027 Q1, margin was 42.8%, up 60 basis points year over year.
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Do not use Q4’s margin spike as a run rate
Fiscal 2026 Q4 gross margin reached 49.2%, up 890 basis points year over year. Nike attributed approximately 900 basis points to the expected recovery of IEEPA tariffs. That specific benefit means the Q4 figure should not be extrapolated as an ordinary operating margin level. Q4 revenue was also down 1% reported and 4% currency-neutral, according to Nike’s fiscal 2026 Q4 results release.
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Is Nike inventory going down?
No across the dates reported: inventory was $7.5 billion on May 31, 2026, flat from May 31, 2025; it then stood at $7.8 billion on August 31, 2026, up 5% from May 31. Nike said the year-end balance reflected increased units offset by product mix, while the August increase primarily reflected product-mix shifts.
The May-to-August change is sequential, not a year-over-year comparison. Nike’s reported dollar balances alone do not establish whether sell-through has improved, whether items are aging, or whether inventory is correctly positioned by product and geography. Avoid calling inventory “cleared” or “excessive” based on the total alone. The reported dates and explanations appear in Nike’s fiscal 2026 filing and fiscal 2027 Q1 filing.
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A practical framework for tracking the turnaround
Use a small, consistent scorecard each time Nike reports. It is an analytical framework, not company guidance.
- Revenue: Compare reported and currency-neutral growth with the same quarter a year earlier; keep full-year totals separate from quarter results.
- Channels: Track wholesale and NIKE Direct independently, including Digital within Direct where disclosed.
- Margins: Record the margin percentage and the stated drivers—discounting, channel and product mix, costs, foreign exchange, and unusual or one-time effects.
- Inventory: Record the balance-sheet date and comparison basis. Use Nike’s unit-versus-mix explanation where provided, and do not infer sell-through from dollars alone.
- Breadth: Check whether improvement extends across geographies and brands, rather than relying on a strong consolidated figure that masks declines elsewhere.
- Persistence: Give more weight to understandable improvement repeated over several reports than to one unusually high margin or one sequential inventory move.
Nike CEO Elliott Hill described fiscal 2026 actions as intended to “strengthen the foundation of NIKE, Inc. and reposition our business for long-term growth.” That is management’s characterization; the revenue, margin, and inventory trends are the evidence investors can use to assess whether those actions are translating into sustained results.
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