Nike shares came under pressure after the sportswear giant reported disappointing fiscal first-quarter sales and issued a weak outlook for fiscal 2027. The company also announced a major restructuring plan that is expected to result in layoffs beginning in 2027.

Nike reported $11.21 billion in revenue for its fiscal first quarter, down 4% year over year and below analysts’ expectations of $11.32 billion. Earnings, however, came in above expectations at 48 cents per share, compared with the 43 cents forecast by analysts.

Nike's net income fell 2% to $712 million, compared with $727 million a year earlier.

Nike shares fell about 8.7% in after-hours trading following the earnings release and were down nearly 10% in premarket trading on Friday, according to the information provided.

The company expects fiscal 2027 revenue to decline by a high-single-digit percentage, while adjusted diluted earnings per share are expected to range between $1.15 and $1.35, excluding approximately 15 cents per share in restructuring-related expenses.

The weaker outlook has prompted several Wall Street firms to reduce their Nike price targets.

BofA lowered its target from $30 to $24, while Goldman Sachs reduced its target from $38 to $30. Wells Fargo cut its target from $40 to $30, and Citi lowered its target from $39 to $32.

Nike’s performance in Greater China continued to weigh heavily on its results. Revenue in the region declined 26% on a currency-neutral basis during the quarter.

CEO Elliott Hill said Nike is moving with urgency to improve its business in China, while acknowledging that the company still has significant work to do across its Sportswear, Jordan Brand and Greater China businesses.

Nike's Sportswear business, which accounts for nearly half of quarterly revenue, declined by a low-double-digit percentage. Meanwhile, the company said its Performance portfolio grew at a high-single-digit rate.

Nike Direct revenue also declined 8% to $4.1 billion, while Nike Brand Digital revenue fell 13%.

Alongside its earnings report, Nike announced a restructuring initiative called “Pace”, designed to simplify its operations and improve productivity.

The plan includes modernizing the supply chain, reorganizing the company into three geographic regions and changing its workforce structure. The regions will be the Americas; Asia Pacific and Greater China; and Europe, the Middle East and Africa.

Nike said the restructuring will result in fewer roles across the company, with layoffs expected to begin in 2027. The company did not disclose how many employees could be affected.

Nike expects the Pace strategy to deliver approximately $2.5 billion in savings through fiscal 2031, although restructuring costs are expected to weigh on fiscal 2027 earnings.

The latest results add to the challenges facing Nike as it attempts to revive sales and strengthen its position in the global athleticwear market.

The company ended the quarter with $7.8 billion in inventory, down 3% from the previous year. Gross margin improved to 42.8%, compared with expectations of 42.4%.

CEO Elliott Hill has emphasized that Nike’s turnaround will take time, particularly as the company works to rebuild its Sportswear and Jordan businesses and address weakness in China.

With a weaker fiscal 2027 revenue forecast, declining digital and direct sales, and restructuring-related costs ahead, investors are closely watching whether Nike's turnaround strategy can restore sustained revenue growth.