The Nike brand managed to grow its revenue even while its digital sales and subsidiary Converse declines kept total organizational revenue roughly flat in its fiscal Q3 2026.

Revenue for the Nike brand reached $11.0 billion, marking 1% year-over-year growth in its fiscal Q3, which ended Feb. 28. Total organizational revenue was essentially flat, notching up to about $11.28 billion in Q3 2026 from $11.27 billion during the same period of its fiscal 2025.

Meanwhile, revenue from its Converse brand fell 35% year over year in Q3, totaling $264 million.

Chief financial officer Matthew Friend also noted that Nike paid $230 million in employee severance costs during Q3. Those employees primarily worked in Nike’s supply chain and technology units, he said.

“Our specific actions in the supply chain will lower costs, streamline operations and reduce capacity in our distribution network,” Friend said. “Over time, we will shift our supply chain network to become more of a variable cost versus the higher fixed cost structure we have today.”

He added that Nike “rightsized operating costs at Converse” in Q3, part of the severance charges.

Nike is No. 13 in the Top 2000. The database is Digital Commerce 360’s ranking of the largest North American online retailers by their annual ecommerce sales. In the database, Nike is the highest-ranking Apparel & Accessories retailer.

Wholesale approach lifts Nike revenue in Q3 2026

Nike Inc.’s revenue gains in the quarter largely stemmed from increases in its wholesale business, which grew 5% to reach $6.5 billion. Meanwhile, Nike Direct — the retailer’s direct-to-consumer segment — sales declined 4% year over year in Q3, to $4.5 billion.

“One of the most important actions we took this quarter was further removing unhealthy inventory of our classic footwear franchises from the marketplace,” CEO Elliott Hill told investors on Nike’s quarterly earnings call.

He called the change “necessary.” Additionally, Hill noted that NBA All-Star Weekend drove full-price sell-throughs and improved Nike’s wholesale partnerships with Dick’s Sporting Goods, Foot Locker and Shoe Palace. He also mentioned “accelerating” wholesale relationships with Academy Sports + Outdoors and JD Sports.

Nike Digital sales drop again in Q3 2026

Friend told investors that Nike’s digital segment “is still too promotional.”

Nike Digital sales declined 9% year over year in its fiscal Q3. That, in part, led to a 7% drop in Nike Direct.

Nike Digital refers only to the brand’s first-party ecommerce websites and apps. Q3 marked the ninth consecutive quarter that Nike Digital sales declined year over year.

“During the pandemic, we accelerated investments across supply chain and technology to support a larger digital and direct business,” Friend said. “Those investments also resulted in a higher fixed cost base that weighed significantly on our EBIT margins as revenue came down.”

In North America, Nike Digital sales declined 7% in Q3. Still, Nike Digital in the region “improved sequentially throughout the quarter,” according to Friend. He credited growth in unspecified “key sports as well as continued improvement in average retail discounts.”

“Inventory dollars grew low-single digits, while units were down high-single digits, with the spread primarily due to tariffs,” Friend said.

In Europe, the Middle East and Africa (EMEA), Nike Digital sales fell 6%. There, Nike was “more aggressive with promotions” on its digital platform, Friend said.

“Given the softness in sportswear, traffic patterns and promotions across Europe, as well as recent disruption in the Middle East, we anticipate ending the fourth quarter with elevated inventory,” Friend said.

In what Nike defines as its Greater China region, its digital revenue fell 21% year over year. And in Asia-Pacific and Latin America (APLA), Nike Digital dropped 12%.

How tariffs and war in the Middle East affect Nike

“While the tariff environment has been uncertain, assuming no significant changes, we expect the first quarter of fiscal ’27 to be the final quarter where higher tariffs continue to be a material year-over-year headwind to gross margin,” Friend said. “We expect gross margin expansion to begin in the second quarter due to actions to mitigate tariffs and recovery of transitory impacts.”

Friend also gave further commentary on the impact of the U.S. and Israel’s war against Iran. He noted that disruptions related to the war “definitely impact the way we’re thinking about the fourth quarter” regarding results in the EMEA region.

Nike has taken into consideration what it has seen in the Middle East regarding traffic, he said. Additionally, it has factored in its expectations for the region based on disruptions to date.

“We also recognize that the environment around us has become increasingly dynamic, and could experience unplanned volatility due to the disruption in the Middle East, rising oil prices, and other factors that could impact either input costs or consumer behavior,” Friend said. “We are focused on what we can control and these assumptions reflect the macro environment as it stands today.”

Furthermore, Friend said Nike is “not seeing a consumer reaction to what’s going on in the Middle East at this point in time in North America.”

He shared that Nike expects its fiscal Q4 revenue to decline in the range of 2% to 4%. In Greater China, specifically, Nike anticipates revenue to decline 20% in Q4.

Greg Zakowicz, ecommerce and retail advisor for Omnisend, told Digital Commerce 360 that Nike’s earnings “are especially positive considering consumers globally are spending cautiously, especially on discretionary purchases.” Omnisend is an ecommerce marketing platform.

Zakowicz said the work Nike has done in previous quarters to respond to tariffs “is helping keep costs in check” amid multiple headwinds.

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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