Nike has reported an 8% decline in revenue for the second quarter of fiscal 2025, which ended on November 30, 2024, bringing total revenue to $12.4 billion. On a currency-neutral basis, revenue fell 9%, with drops across all Nike Brand and Converse geographies. Direct revenues experienced a notable 13% decline, driven by a 21% drop in Nike Brand Digital sales and a 2% decrease in Nike-owned store revenues. Wholesale revenues also fell by 3%.
The company’s gross margin decreased by 100 basis points to 43.6%, impacted by higher discounts and changes in channel mix, although lower input and logistics costs provided some relief. Operating costs presented a mixed picture: selling and administrative expenses fell by 3% to $4 billion, with operating overheads reduced by 5% due to lower wage-related expenses. Conversely, demand creation expenses rose by 1%, driven by increased spending on sports marketing.
Net income dropped 26% to $1.2 billion, with diluted earnings per share falling 24% to $0.78. Despite the challenging environment, Nike maintained a stable effective tax rate of 17.9%. The company returned $1.6 billion to shareholders, including $557 million in dividends—a 7% increase year-over-year—and $1.1 billion through share repurchases.
Nike’s inventory remained flat year-over-year at $8 billion, reflecting higher unit volumes offset by changes in product mix and reduced input costs. Cash and equivalents declined slightly to $9.8 billion, down by $0.2 billion, attributed to operational cash flow, share repurchases, dividends, and capital expenditures.
Nike Chief Financial Officer Matthew Friend highlighted the company’s ongoing efforts to reposition its portfolio under new leadership: “Nike’s second-quarter financial performance largely met our expectations as we continue to make progress in shifting our portfolio. Under Elliott’s leadership, we are accelerating our pace and reigniting brand momentum through sport.”
CEO Elliot Hill, who recently returned to lead the company, emphasized a renewed focus on sport at the core of Nike’s strategy: “After an energizing 60 days of being back with my Nike teammates, our clear priority is to return sport to the center of everything we do. We are taking immediate action to reposition our business so we can get back to driving long-term shareholder value. Our team is ready to go, and I am confident you will see more moments of Nike being Nike again.”
