Nike Inc. (NYSE:NKE) saw its market capitalization plummet $230 billion from its peak as the sportswear giant’s turnaround faces another setback after first-quarter revenue missed estimates and executives warned that Greater China sales will worsen in the near term.

The China Market Reset

During the post-earnings call, President and Chief Executive Officer Elliott Hill addressed a 26% revenue drop in Greater China. Hill announced a strategy to overhaul operations by severing ties with certain online distributors.

“We are eliminating distribution through channels that are not aligned with our marketplace strategy, which will decrease the deep discounting of our brands,” Hill said.

The restructuring centers digital sales on flagship storefronts across platforms like Tmall, JD, and Douyin. Chief Financial Officer Dave Denton told investors this strategy will negatively impact metrics in the near term.

“The guidance range that I just provided to you assumes that China actually gets worse from a revenue perspective for the balance of this year,” Denton said. “And that’s because of some of the actions we’re taking today to make sure that we return this business to health in the long term.”

Widespread Revenue Contraction

The contraction in China contributed to an overall earnings miss. Nike reported revenue of $11.21 billion, missing analyst estimates of $11.33 billion. Total revenue fell 4% year-over-year.

Management projected that company-wide revenues will decline in the high single digits for fiscal 2027. Following the guidance, Nike shares sank in after-hours trading to price levels last seen in 2013.

Wealth Destruction

The extended stock slide has heavily impacted shareholder portfolios. Financial commentary account The Kobeissi Letter noted on social media platform X that Nike stock is down 82% from its record high, “erasing -$230 billion in market cap.” When checked from historical data, NKE closed at a record high of $177.51 on Nov. 5, 2021, dropping by 80.2% to $35.15 as of Thursday’s close.

Market strategist Shay Boloor quantified the drop for investors on X, stating that a $10,000 investment made four years ago is worth “a little over $2K today,” adding in the thread, “Just Don’t Do It.”

Despite the pressure, Hill pointed to growth in the performance division. He highlighted the “Caitlin 1” women’s basketball shoe launch, which reached 5,000 doors, as evidence the sport offense remains viable.

Addressing the company’s broader trajectory, market commentator Jim Cramer noted on X that “Nike ALWAYS has some tremendous positive moments that lure you in but the aggregate outlook is terrible and, arguably, worsening…”

How Has NKE Performed in 2026?

Price Action: At the last check, the NKE stock slipped 8.71% in after-hours, and it was 8.31% lower in overnight trading. It was down 52.63% over the last year, 44.83% year-to-date, and 7.79% over the last month. The stock closed down 0.71% at $35.15 on Thursday.

Benzinga’s Edge Stock Rankings indicate that NKE maintains a weak price trend in the short, medium, and long terms, with a good value score.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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