Shares in legacy athletic apparel maker Nike (NKE) plunged more than 10% on Friday after its Q2 2026 earnings results prompted price target cuts on Wall Street over profit margin concerns. One analyst warned that “turnarounds take longer.”
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During the quarter, Nike’s earnings per share fell 32% year-over-year to $0.53, above the analyst consensus of $0.38. Sales rose modestly by 1% to $12.4 billion, slightly beating Wall Street’s projection of $12.21 billion.
Tariff Hits Nike’s Profit
Reacting to the results, Barclays analyst Adrienne Yih trimmed her NKE price target by 9% from $70 to $64, implying about 11% upside potential. Yih, who has a Hold rating on the stock, noted that Nike’s gross margin was no surprise, as tariffs continued to exert pressure on profitability.
The four-star analyst noted that Nike’s sales in North America — which account for the biggest chunk of the company’s sales (see the image below) — continued to improve, even as inventory “remains clean.”
Nike’s China Sales Continue to Suffer
Meanwhile, Barclays’ Yih further argued that pressure in other regions and murky demand visibility informed her team’s bearish outlook on NKE stock.
In addition, while Piper Sandler analyst Anna Andreeva praised Nike’s “healthy” inventories and “signs of life” in other verticals, she noted that the apparel maker’s sales recovery in China will require more time. During the quarter, Nike’s revenues from China fell for the sixth straight quarter and dropped by 17% to $1.42 billion.
Andreeva sees Nike’s guidance for its third quarter as conservative and emphasized that “turnarounds take longer.” During the last quarter, Stifel analyst Jim Duffy had called Nike’s revenue of $11.7 billion — which grew by 1% from the prior year — “strong signs of validation of the turnaround.”
Is NIKE Stock a Buy, Sell, or Hold?
Across Wall Street, Nike’s shares continue to carry a Moderate Buy consensus rating.
This breaks down to 20 Buys and nine Holds issued by analysts over the past three months. However, the average NKE price target of $83.54 implies more than 27% growth potential.
