Nike just pulled off something that seemed impossible a few months ago: it made investors actually *excited* about a company that’s been bleeding red for four straight years. The stock rocketed 15% on Friday after earnings, and honestly? There’s a method to this madness.
Here’s the deal: Nike’s numbers were genuinely rough. Revenue tanked 12% to $11.1 billion, and net income got absolutely demolished—down 86% year-over-year. China sales? Down 20%. Europe down 9%. North America down 11%. This isn’t a company firing on all cylinders.
But here’s where it gets interesting. CEO Elliot Hill, who took over last October, didn’t just shuffle the deck chairs. He launched something called “Win Now”—and it’s actually working. The strategy is laser-focused: five sports (basketball, soccer, running, training, sportswear), three countries (US, UK, China), five cities (New York, LA, Beijing, London, Shanghai). No fluff. No fashion tangents. Just pure sports obsession.
The market loved it because Hill’s actually delivering. The company beat earnings estimates despite the carnage, and Wall Street responded with price target upgrades. Truist bumped their target to $85—a $12 jump. That’s not nothing.
Of course, there’s a tariff-shaped elephant in the room. Nike’s facing a $1 billion cost headwind from tariffs, which will hit gross margins by 75 basis points in fiscal 2026. The company’s already reshuffling its supply chain—cutting China production from 16% to the high single digits—and planning “surgical” price increases in the fall. It’s not elegant, but it’s realistic.
The real question: is this the time to buy? Probably not yet. Nike’s still trading at a P/E of 29, which is expensive for a turnaround story. Plus, the tariff pain is front-loaded in the first half of the year. But if Hill keeps executing on Win Now, and the company can navigate the tariff minefield without alienating customers, Nike could actually become interesting again. For now, it’s a “watch and wait” situation—unless you’re already a believer in the turnaround.
