Have you noticed how even giant companies like Nike can stumble? Yesterday, on December 18, 2025, the sportswear king reported its second-quarter earnings for fiscal 2026, and things didn't look great. Shares dropped a whopping 10% in after-hours trading, leaving investors scratching their heads and wondering what's next for the brand everyone knows from sneakers to jerseys.
So, what went wrong? Sales in China, one of Nike's biggest markets, plunged 17%—that's the sixth quarter in a row of declines. Based in Beaverton, Oregon, Nike has been counting on that region for growth, but economic slowdowns there have hit hard. CEO John Donahoe mentioned during the earnings call that they're shifting focus back to core sports like running and basketball, plus teaming up more with retailers.
But honestly, it's a reminder that no company is immune to global headaches. Then there's the tariff issue biting into profits. With new trade duties ramping up costs on imports, Nike's margins shrank again, leading to a 32% drop in net income.
The stock closed the day around $59.09 after the fall, and it's already down 13% this year. Nike's been around here and has bounced back before. In the end, despite a slight overall revenue increase, the China downturn and tariffs dominated the narrative.
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