Nike Q2 Preview: Here’s What to Expect

Nike (NKE), the leader in athletic footwear, apparel, and equipment, is set to report its second-quarter fiscal 2026 earnings on Thursday, Dec. 18. The announcement comes at a time when the company is working through a multi-year effort to revive growth and streamline its operations. While these initiatives are beginning to show early signs of progress, Nike stock has remained under pressure as investors remain cautious.

Nike shares have lagged broader equity markets this year, down 11% year to date. Demand conditions remain challenging in some of the company’s most important regions, particularly North America and China, where consumer spending and competitive pressures have kept growth subdued. These headwinds continue to weigh on sentiment, even as management pushes forward with strategic adjustments.

Despite the stock’s weakness, Nike’s earnings history offers a different picture. Over the past four quarters, Nike shares have risen following earnings announcements in three instances, suggesting that expectations may often be set conservatively going into results. This dynamic makes the upcoming report especially relevant for short-term traders.

Meanwhile, the options market indicates that investors are bracing for a notable move in Nike stock after the earnings release. Based on current contracts expiring Dec. 26, traders are implying a post-earnings move of about 7.4% in either direction. This is modestly higher than Nike’s average post-earnings move of approximately 6.8% over the past four quarters, signaling elevated uncertainty around the near-term outlook.

Nike Q2: Here’s What to Expect

Revenue is likely to remain under pressure, while margins and earnings could continue to face headwinds, despite encouraging signs in certain parts of the business.

Management has guided for Q2 revenue to decline in the low single digits, a forecast that includes a modest 1% benefit from foreign exchange. At first glance, this outlook may appear conservative. Nike’s wholesale business has been showing improving momentum, supported by deliberate efforts to broaden distribution and reach new consumer segments. These strategic initiatives are beginning to show results and could help offset some of the overall softness. However, difficult year-over-year comparisons could remain a drag.

The digital channel is expected to be a more meaningful drag on performance in the quarter. Following the holiday season last year, Nike began implementing its “Win Now” actions, which included a significant reduction in promotional intensity. While this shift is aimed at protecting brand strength and long-term profitability, it creates a tougher comparison for NIKE Digital in Q2, where lower promotional activity is weighing on near-term sales.

Regionally, North America continues to show signs of building momentum. Sustained brand activity across key sports categories, combined with Nike’s sports marketing portfolio, is helping support demand. Greater China remains more challenging. Store traffic there is likely to stay under pressure, even though certain categories are performing well. Running has emerged as a bright spot, delivering high single-digit growth during the last reported quarter. Even so, overall marketplace traffic remains weak across both Nike-owned and partner stores. Digital sales in China also remain highly promotional, with consumers taking longer to make purchases and demanding deeper discounts on local platforms.

From a profitability standpoint, the outlook remains cautious. Margin pressure is expected to persist due to higher wholesale discounts, increased product costs, the impact of new tariffs, and unfavorable channel-mix dynamics.

Against this backdrop, analysts are forecasting a notable decline in earnings for the quarter. Consensus expectations call for earnings of $0.37 per share, representing a year-over-year decline of more than 52.6%. That said, Nike has a recent track record of outperforming expectations. The company has delivered earnings beats in each of the past four quarters, including a particularly strong upside surprise of 81.5% in the last reported quarter.

The Bottom Line

Nike’s near-term fundamentals remain challenged, particularly in revenue growth, digital demand, and margins. However, early signs of stabilization in wholesale, improving momentum in North America, and category-level strength in areas such as running suggest that Nike’s strategic reset is beginning to gain traction, but unevenly across regions and channels.

Despite near-term challenges, Nike stock carries a “Moderate Buy” consensus rating, reflecting analysts’ confidence in Nike’s brand strength. However, investors should exercise caution, as Nike’s second-quarter earnings report is likely to face meaningful headwinds.