Nike Digital sales fell 13% year over year in the retailer’s fiscal Q1 2027, marking the ecommerce business’s 11th consecutive quarter of declines.
Overall, Nike’s revenue declined 4% to $11.2 billion for the quarter ended Aug. 31. Executives pointed to Nike Sportswear, Jordan Brand and Greater China as significant pressures on the business.
One bright spot, however, was Nike’s Performance business. It includes apparel, footwear and accessories designed for running, training and other sports. Performance grew in the high single digits during Q1, helped in part by World Cup demand, chief financial officer Dave Denton told analysts during Nike’s Q1 earnings call.
“Taken together, the quarter shows a business in transition,” Denton said. “We are not where we want to be yet, but we have a strong understanding of the trends throughout the business and, importantly, the actions required to improve results over the long term.”
Nike is No. 15 in the Top 2000 Database. The market research tool ranks North America’s largest online retailers by their annual ecommerce sales. In the database, Nike is the highest-ranking Apparel & Accessories retailer.
Nike revenue challenges in Q1 2027
Elsewhere in the business, Nike Direct revenue decreased 8% year over year in Q1 to $4.1 billion, reflecting declines in both Nike Digital and Nike-owned stores. Nike Direct encompasses the retailer’s stores, along with its ecommerce websites and apps.
Nike Brand wholesale revenue, meanwhile, declined 1% to $6.8 billion.
Nike Sportswear accounted for just under half of the company’s Q1 revenue. Still, sales in the business fell in the low double digits. Some of that decline was deliberate: Nike cut revenue from its Dunk franchise by nearly 50%, creating a roughly $200 million headwind. Older, high-volume footwear also sold more slowly than expected, CEO Elliott Hill told analysts.
Broader weakness in the lifestyle market added to the pressure. “Overall, there’s a lack of energy in the lifestyle space right now, which is impacting traffic,” Hill said. “Yes, the consumer is cautious. But as the leader in the industry, it’s on us to bring more creativity to Sportswear.”
Jordan Brand faced similar challenges. The business represented about 13% of Nike’s global revenue in Q1, with sales declining in the mid-teens. Hill attributed some of that weakness to an oversupply of retro footwear, adding that Nike plans to reduce the volume and frequency of certain launches.
Nike resets its digital strategy in Greater China
Greater China proved an even steeper drag, with revenue falling 26% on a currency-neutral basis. After more than two years of declining revenue in the market, Nike has been reshaping its digital strategy there. Hill said the company began reducing distribution in July through digital channels that “are not aligned with our marketplace strategy.” The goal is to curb deep discounting and create “a more premium and culturally relevant brand,” he said.
Nike now plans to concentrate its China ecommerce business around official flagship stores on Tmall, JD and Douyin, alongside Nike.com and the Nike app, he said. “We believe a tightened digital ecosystem of Nike flagships will enable a more premium brand presentation with clearer product stories and a more connected consumer journey,” Hill said.
Hill said Nike expects the digital cleanup to stretch across multiple seasons, with revenue and profitability in China under pressure in the near term. As Nike carries out the overhaul, Denton added that the company’s fiscal 2027 guidance assumes China revenue worsens for the remainder of the year.
The retailer is also developing more products specifically for Chinese consumers. Nike plans to launch its first ‘China, made for China’ collection in October, initially through brick-and-mortar stores, Hill said.
Nike restructuring to include job cuts
Alongside those marketplace changes, Nike also outlined a broader restructuring effort that includes planned workforce reductions.
Nike expects the new effort, called Pace, to generate about $2.5 billion in cumulative savings through fiscal 2031. Designed to accelerate Nike’s existing “Sport Offense” turnaround strategy, Pace includes changes to the company’s supply chain and geographic structure, as well as efforts to reduce organizational layers and costs, executives said.
That streamlining will include job cuts. Nike has not disclosed how many positions it will cut or where, but Hill said the company expects the number of roles across Nike to decline over time.
“In some areas, we will add capabilities to increase speed and scale; in others we will eliminate duplication,” Hill said. “Over time, those changes will reduce the overall number of roles across Nike.”
Nike expects Pace to cost approximately $1 billion to carry out. The company expects to realize most of the $2.5 billion in savings in fiscal 2029 and 2030, with the program continuing through fiscal 2031, Denton said.
Nike Digital sales in Q1 2027
In Q1 2027, Nike Digital sales decreased 13% year over year on a currency-neutral basis. Digital revenue totaled $1.8 billion, down from $2.1 billion a year earlier.
In its quarterly filing with the SEC, Nike said it is repositioning Nike Brand Digital as a “full-price platform” as it clears older inventory and makes room for newer products.
Nike reported ecommerce sales declines across all of its geographic regions.
In North America, Nike Digital sales decreased 6% on a currency-neutral basis. Nike Direct revenue in the region also fell 6%, while wholesale grew 9%. Overall North America revenue increased 2%.
In Europe, the Middle East and Africa, Nike Digital sales fell 26%. Nike Direct revenue declined 12%, while overall revenue decreased 5%.
Greater China recorded the steepest ecommerce decline. Nike Digital sales fell 28%, while Nike Direct revenue decreased 18%. Overall revenue in the region dropped 26%.
And in Asia Pacific and Latin America, Nike Digital sales fell 10%. Nike Direct revenue declined 3%, while overall revenue was flat.
The pressure is expected to continue. Denton said Nike expects revenue to decline in the high-single-digit range for fiscal 2027.
As Nike works to improve full-price sales, Denton said it will continue reducing supply in parts of Sportswear, Jordan Brand and Greater China. Those actions are expected to weigh on reported revenue for the remainder of fiscal 2027 and into fiscal 2028.
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