NIKE, Inc.

Headline performance (FY26 + Q4) & what drove it - FY26 revenue: flat reported / -2% currency-neutral; Q4 revenue: -1% reported / -4% currency-neutral. - Gross margin: - Q4: 49.2%, up +890 bps YoY, but largely due to a one-time tariff recovery. - FY26: 42.9%, up +20 bps YoY, also including tariff recovery. - EPS: Q4 $0.72 reported; $0.20 excluding the tariff benefit. FY26 diluted EPS $2.10 (-3% YoY); $1.58 excluding tariff benefit. - Key operational split: Performance business momentum (Running/Training/Football growing mid-single digits retail) is being offset by Sportswear + Jordan weakness (sell-through still challenged → pressure on discounting and future order books).

The “surprising” item: IEEPA tariff benefit (non-recurring) materially lifted margins - NIKE recognized an unplanned one-time benefit of $986 million in Q4 after concluding the financial recovery of incremental tariffs became probable. - Cash collected: >$300 million by quarter end (rest recorded as accounts receivable awaiting recovery). - Management emphasized this is dynamic/uncertain going forward and still a headwind in the outlook.

Forward guidance: earnings “flattish,” revenue down, margin expansion expected earlier - 3-quarter earnings outlook (Q4 FY26 through Q2 FY27): “flattish” earnings excluding the tariff recovery benefit. - Revenue outlook: expected down low-to-mid single digits (macro + sell-through softness). - Margin: gross margin expansion begins earlier in Q1 (i.e., improvement starts sooner than previously implied). - Q1 specifics: reported revenue down low-to-mid single digits, no FX tailwind expected, gross margin slightly positive. - Q2 caution: sequential deceleration vs Q1 due to EMEA digital promotions comp, and North America wholesale timing anomaly. - Tariff assumption for forecast: incremental rates 10% through end of July, then 15% thereafter.