Nike Q2 2025 Performance
Nike (NKE) reported its earnings for the second quarter of 2025, reflecting a revenue decline as the company embarks on a strategic transformation under new CEO, Elliott Hill, who took office in October 2024. The company is focusing on re-energising its brand by returning to its sports-centric roots and strengthening relationships with wholesale partners.
Key Financial Metrics:
● Revenue: $12.4 billion, an 8% decrease year-over-year.
● Net Income: $1.16 billion, down from $1.58 billion in the same quarter the previous year.
● Earnings Per Share (EPS): $0.78, compared to $1.03 the previous year.
● Gross Margin: Decreased 1% to 43.6%, primarily due to higher discounts.
Outlook and Analyst Consensus:
Looking ahead, Nike anticipates continued challenges in the near term, with expectations of low double-digit revenue declines and gross margin reductions between 3% and 3.5% in the third quarter. The company plans to reduce discounts and reposition products as premium offerings, which may impact short-term sales but aims to drive long-term growth. Analysts remain cautiously optimistic about Nike’s long-term outlook. According to FactSet, the stock holds an "Overweight" consensus rating with an average price target of $125, an over 66% increase from the current share price, reflecting confidence in Nike’s strategic initiatives and ability to recover from short-term pressures. Technical analysis suggests the stock is trading near a key support level of $71, with potential upside if it tests and closes above the $71 range.
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** This article was prepared by BROKSTOCK analyst Maboko Seabi
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