Elliott Hill’s plan to transform NIKE: innovation, sport and profitability as a priority Merca2.0
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U.S. multinational NIKE ended its fiscal year 2026 with a clear message for investors and consumers: the company is undergoing a deep transformation aimed at returning it to a path of sustainable growth. Elliott Hill, the company’s President and Chief Executive Officer, has launched a strategy focused not only on selling more products, but also on rebuilding the company’s foundations through innovation, brand strengthening, operational efficiency, and closer connections with athletes and consumers around the world.
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The fourth-quarter financial results show that the company is beginning to see progress. Although sales remained virtually unchanged from the previous year, NIKE significantly improved its profitability and maintained strong performance in North America while working to reverse the weakness it continues to face in markets such as China.
What is Elliott Hill’s plan to transform NIKE?
During the earnings presentation, Elliott Hill explained that fiscal year 2026 was focused on strengthening the company’s foundations to prepare for a new stage of long-term growth.
According to the executive, the strategy, internally known as Sport Offense, aims to improve four key areas:
- Strengthen the company’s organizational culture.
- Accelerate product innovation.
- Reinforce the global value of the NIKE brand.
- Improve the way the company serves consumers in every country and city.
“In fiscal year 2026, we took decisive actions to strengthen the foundation of NIKE, Inc. and reposition our business for long-term growth,” Hill said while presenting the fiscal-year results.
The CEO acknowledged that the company continues to face revenue pressure but said there are encouraging signs thanks to the performance of its high-performance sports product lines and improved commercial execution.
NIKE maintains more than $46 billion in annual revenue
Despite a challenging economic environment and weaker demand in some international markets, NIKE ended the fiscal year with revenue that was virtually unchanged.
Throughout fiscal year 2026, the company reported:
- $46.398 billion in revenue, virtually unchanged compared with the previous year.
- On a currency-neutral basis, sales declined by 2 percent.
Meanwhile, fourth-quarter revenue totaled $10.972 billion, a decline of just 1 percent compared with the same period a year earlier.
These results reflect a stabilization of the business after several quarters marked by inventory adjustments, slower consumer spending, and changes to the company’s commercial strategy.
Profitability became a top priority
One of the most significant highlights of the financial report was the strong recovery in profit during the fourth quarter.
NIKE posted net income of $1.069 billion, representing a 407 percent increase compared with the $211 million reported a year earlier. Earnings per share also rose from $0.14 to $0.72.
Gross margin also improved from 40.3 percent to 49.2 percent, driven primarily by the expected recovery of tariffs paid in the United States under the International Emergency Economic Powers Act (IEEPA). The company said this benefit contributed approximately $986 million, significantly boosting quarterly profitability.
North America leads NIKE’s recovery
One of the markets supporting Elliott Hill’s strategy was North America.
During the fourth quarter, the region generated $4.832 billion in revenue, a 3 percent increase compared with the same period a year earlier.
For the full fiscal year, North America recorded $20.511 billion in revenue, representing 5 percent growth.
Growth was driven by:
- Footwear: +5%.
- Apparel: +4%.
- Equipment: +6%.
This performance helped partially offset weakness in other regions.
NIKE adjusts its commercial strategy
Another major shift involves changes to the company’s commercial model. Over the past few years, NIKE strongly promoted its Direct to Consumer (DTC) strategy, prioritizing sales through its own retail stores and digital platforms. However, the 2026 results indicate a change in direction.
Wholesale sales increased 4 percent during the fourth quarter, reaching $6.6 billion.
By contrast, NIKE Direct generated $4.1 billion in revenue, down 7 percent, affected by a 12 percent decline in NIKE Brand Digital and a 7 percent decrease in company-owned stores.
This performance reflects a renewed commitment to strengthening relationships with wholesale partners and retail distributors.
Sports innovation remains the company’s biggest bet
Beyond the financial results, Elliott Hill emphasized that future growth will depend on restoring NIKE’s leadership in innovation.
The company said it will continue developing products focused on athletic performance while strengthening the consumer experience across its key global markets.
Chief Financial Officer Matthew Friend added that the company will continue optimizing its product portfolio, adjusting operating costs, and investing to improve the quality of its marketplace. However, he acknowledged that the commercial environment remains challenging and that sales growth continues to face pressure.
