Nike Inc. revenue continued its year-over-year decline in the company’s fiscal Q2 2025, which ended Nov. 30, 2024, as digital sales sunk.
Total Nike Q2 revenue fell 8% to $12.35 billion. Meanwhile, Nike Direct revenue declined 13% to $5 billion. Nike Direct refers to the retailer’s direct-to-consumer sales, both in physical stores and online. Elsewhere, Nike wholesale revenue fell 3% to $6.9 billion.
Chief financial officer Matthew Friend told investors on the retailer’s earnings call that Nike’s “Q2 financial performance largely met” expectations as the brand works to reposition its business.
Q2 marked the fourth consecutive quarter in which Nike Digital sales dropped, and the retailer’s revenue also declined 13%.
“We’ve shifted investments away from creating demand for our brand to capturing demand through performance marketing for our digital business,” said Elliott Hill, president and CEO, in his first earnings call since returning to the company about two months ago.
Hill previously retired from Nike in 2020. On Sept. 19, the company announced that he would replace John Donahoe as its top executive.
“Prioritizing Nike Digital revenue has impacted the health of our marketplaces,” Hill told investors. “We will build back an integrated marketplace. Across Nike Direct and wholesale, our marketplace will be consumer-led, putting our best product and presentation in the path of the consumer, wherever they choose to shop.”
Nike is No. 9 in the Top 1000. The database is Digital Commerce 360’s ranking of the largest North American online retailers by their annual web sales. In the database, Nike is the highest-ranking Apparel & Accessories retailer.
Nike Digital sales continue to plummet in Q2
Nike Digital encompasses global sales through the retailer’s website and mobile app. Q2 marked the fourth consecutive quarter in which Nike Digital sales dropped. It was also the second straight of at least 20% year-over-year decline.
Nike Digital sales dropped by 21%, leading the quarter’s decline in Nike Direct sales. The other portion of Nike Direct, physical-store sales, fell 2%.
Nike Digital sales fell at close to triple the rate of the retailer’s total revenue decline.
“Traffic in Nike Direct, digital and physical, has softened because we’ve lacked newness in product,” Hill said, adding that the retailer has “become far too promotional. Entering the year, our digital platforms were delivering roughly a 50/50 split of full price to promotional sales. The level of markdowns not only impacts our brand but it also disrupts the overall marketplace and the profitability of our partners.”
He said he and his team will “return” Nike to being a premium destination, and that “being premium also means full price.” As a result, Nike will focus promotions “during traditional retail moments,” he added.
Both traffic and sales fell below Nike’s expectations for the quarter, Friend said. That wasn’t the case during Thanksgiving week, though. Digital and physical-store traffic improved to end the quarter.
In North America, Black Friday week was the retailer’s “largest demand week ever on Nike Digital, with sales up double-digits,” Friend said.
Similarly, in the Greater China region, performance for the Nov. 11 shopping holiday (called Singles’ Day) exceeded the performance Nike planned, he added.
“We are shifting Nike Digital to a full-price model and reducing the percentage of our business driven by promotional activity,” Friend said. “We are also reducing investment in performance marketing, which will reduce paid traffic. This will require short-term liquidation of excess inventory through less profitable channels.”
Nike Q2 revenue by region and segment
In North America, Nike Q2 revenue decreased 8% year over year. Nike Direct sales fell 15% as Digital dropped 22% and physical stores 3%. Wholesale revenue was nearly flat, slipping down 1%.
In Europe, the Middle East and Africa (EMEA), Nike Q2 revenue fell 10%. Nike Direct sales fell 20% as Digital dropped 32% and stores 3%. Wholesale revenue declined 4%.
In the Greater China region, Nike Q2 revenue fell 11%. There, Nike Direct sales dropped 7% as Digital fell 4% and physical stores 8%. Unlike in North America and EMEA, wholesale revenue fell at the fastest rate (15%).
Meanwhile, in Asia-Pacific and Latin America (APLA), Nike Q2 revenue dipped just 2%. Nike Direct sales in the region fell 4% as Digital dropped 8% and stores 2%. Similar to North America, wholesale revenue was nearly flat, slipping down 1%.
Percentage changes may not align exactly with dollar figures due to rounding. Check back for more earnings reports. Here’s last quarter’s article on Nike Digital sales.
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