Nike stock experienced a retreat in late Thursday trading as the athletic retailer fell short of sales expectations for its fourth-quarter report. Earnings for Nike increased by 50% to 99 cents per share, while revenue dipped by 2% to $12.6 billion. Excluding restructuring charges, Nike’s earnings were $1.01 per share for the quarter, slightly higher than the expected 84 cents per share on revenue of $12.86 billion.

Specifically, Nike brand sales eased by 1% to $12.1 billion, and Converse revenue dropped by 18% to $480 million. Nike brand footwear sales declined by 4%, but apparel sales saw a 3% increase. Equipment sales, however, rose by 34% in Q4.

Nike Direct revenue fell by 8% to $5.1 billion, with a 10% decline in Nike brand digital sales and a 2% decrease in Nike-owned stores. On the other hand, wholesale revenue increased by 5% to $7.1 billion. The company’s gross margin also grew by 110 basis points to 44.7%, driven by various strategic actions.

For the full year, Nike’s earnings increased by 15% to $3.73 per share, slightly surpassing estimates. However, the revenue for 2024 remained flat at $51.36 billion, falling short of the forecasted $51.63 billion.

Analysts at Oppenheimer reinstated Nike as a top megacap pick, upgrading the stock to outperform. They noted that Nike has been facing challenges over the past few quarters but believe that the retailer is now on the path to recovery. Despite ongoing challenges, the firm sees a turnaround in progress, with expectations of revenue growth and improved results starting in the second half of 2025.