Nike reported mixed first-quarter results on Thursday and announced a restructuring plan that will result in layoffs starting next year.

The company also provided a full-year outlook, projecting revenue to decline by a high single-digit percentage for fiscal 2027. Nike also said it expects adjusted earnings per share to be in the range of $1.15 to $1.35.

Here is how the company's results compared with analyst expectations: Earnings per share: 48 cents vs. 43 cents expected; Revenue: $11.21 billion vs. $11.32 billion expected.

Nike reported net income of $712 million, down 2% from $727 million in the same period a year earlier. Revenue fell 4% to $11.21 billion.

The retailer said Nike brand revenue was hurt primarily by continued declines in its China business. Revenue in that market dropped 26%. CEO Elliott Hill said on the analyst call that the company is "moving with urgency" to improve business in the region.

Revenue in North America came in at $5.13 billion, slightly above the $5.11 billion expected by StreetAccount.

Nike also reported a gross margin of 42.8%, above the 42.4% expected.

Hill told analysts: "Despite this progress, our Nike sport performance business is not yet large enough to offset the pressures facing Nike sportswear, the Jordan brand and Greater China. We are taking prudent actions to strengthen these businesses, but it will still take time to fully realize the benefits of these efforts."

Nike's sportswear business — which Hill said accounted for less than half of quarterly revenue — declined by a low double-digit percentage. He said on the call: "Overall, there is currently a lack of energy in the lifestyle space, and that is impacting traffic. Yes, consumers are cautious, but as the industry leader, it is our responsibility to bring more creativity to sportswear."

Nike Restructuring

The sneaker giant also announced a restructuring plan "to position Nike for long-term growth." The strategy is expected to result in layoffs beginning in 2027, though the company did not provide further details on how many positions would be cut.

Hill wrote in a letter to employees: "This work will result in a reduction of roles across Nike, and I recognize that news like this brings uncertainty. I do not take that lightly."

This is the third round of layoffs Nike has announced this year.

The company said it plans to focus on modernizing its supply chain, reorganizing into three geographic regions, building a new campus in India, and changing the way it works and its workforce structure.

The three geographic regions will be: the Americas; Asia Pacific and Greater China; and Europe, the Middle East and Africa.

The strategy, which Nike has named "Pace," is expected to deliver approximately $2.5 billion in cost savings by fiscal 2031. The company added that it will result in restructuring charges that will boost earnings per share by 15 cents in fiscal 2027.

Hill said on the call: "We expect Pace to simplify decision-making so we can capture demand faster and improve productivity, while also creating more room to invest in the areas that have always set Nike apart: serving athletes, creating industry-leading innovation, and building the world's strongest sports brand."

The retailer is in the midst of a turnaround plan focused on improving different parts of its business at different speeds based on priorities.

Nike consumers are also facing increasing macroeconomic pressure, with geopolitical tensions and higher inflation leading to slower spending.

Nike shares have plunged more than 40% this year.