The Swoosh delivered on first-quarter results, sending shares of Nike Inc. up in after-hours trading.

Nike’s president and chief executive officer Elliott Hill told investors in a late afternoon conference call on Tuesday that the company has realigned 8,000 of its employees to Sport Offense, a new initiative that aligns the three brands — Nike, Jordan and Converse — “into more nimble-focused teams by sport.”

He said the strategy will give each brand its own distinct identity to serve different consumers.

But Hill was also quick to note “how much we still must do to meet our full potential. Nike’s journey back to greatness has only just begun.”

Also on the agenda is a focus in key areas, including sportswear, Nike China and Nike Direct. He said Nike’s Air Force 1 franchise is stabilizing, while the Converse Chuck Taylor sneaker is in the “early stages of a global market reset.” Moreover, Converse has new leadership to help drive profitability in the future.

Hill said in a statement that Nike in the quarter “drove progress through our Win Now actions in our priority areas of North America, wholesale and running.” The CEO added that while “we’re getting wins under our belt, we still have work ahead to get all sports, geographies and channels on a similar path as we manage a dynamic operating environment.”

The sports apparel and sneaker firm’s executive vice president and chief financial officer Matthew Friend said he was encouraged by the momentum in the quarter but also cautioned that progress “will not be linear as dimensions of our business recover on different timelines.”

For the three months ended Aug. 31, net income fell 30.8 percent to $727 million, or 49 cents a diluted share, from $1.05 billion, or 70 cents, in the same year-ago quarter. Total revenues rose 1.1 percent to $11.72 billion from $11.59 billion last year.

Those numbers gave Nike an easy beat to Wall Street’s consensus expectations, which was 27 cents in adjusted diluted earnings per share on revenues of $10.99 billion.

By category, Nike Direct revenues were down 4 percent to $4.5 billion, reflecting a 12 percent decline in Nike Brand Digital and a 1 percent decrease in Nike-owned retail stores. Wholesale revenues rose 7 percent to $6.8 billion. Revenues for the Nike brand were up 2 percent to $11.4 billion, while revenues for Converse were down 27 percent to $366 million.

Shares of Nike closed Tuesday’s trading session up 0.3 percent, or 18 cents, to $69.73. The company posted first-quarter results after the market close, but it appeared that investors were already pricing in a quarter that would reflect positive progress in its turnaround strategy. After-hours trading sent shares of Nike up 3.3 percent, or $2.27, to $72 at 5:36 p.m.

The company said gross margin fell 320 basis points to 42.2 percent, primarily due to lower average selling price, reflecting higher discounts and channel mix, as well as higher tariffs in North America.

Inventories at the end of the quarter were $8.1 billion, down 2 percent from the prior year. That change reflects a decrease in units, partially offset by increased product costs, primarily due to higher tariffs in North America.

The company in the first quarter returned about $714 million to shareholders through a combination of share repurchases of $123 million, or the retirement of 1.8 million shares, and dividends of $591 million, up 6 percent from the prior year and reflecting 23 consecutive years of increasing dividend payouts.

There’s been concern among shoe and sneaker brands over a potential pullback on footwear spend over the holiday due to higher prices because of tariffs.

Nike in May disclosed that U.S. retail prices on higher-priced sneakers would increase on June 1, although the Swoosh did maintain current price points for the Jordan brand and Nike kids apparel and footwear.

Perhaps the bigger issue for Nike was how much progress it has made in its turnaround. The early read from the summer was good when it appeared that Nike foot traffic returned to positive growth in August, according to Jefferies analyst Randal Konik. Among the newer products introduced in 2025, Nike’s Vomero 18 surpassed $100 million earlier this year. Specialty retailers confirmed this summer that the Nike Running comeback was very much on.

And there’s expectation of strength ahead. The NikeSkims apparel collaboration could further drive interest among female customers, while Nike continues to be prolific with new style launches. The new women’s sneaker Astra Ultra, which surfaced in June, featured shapes and patterns created by generative AI. And further out, the Nike Air Max Phenomena SWDC (Serena Williams Design Crew) sneaker loafer featuring a Pearl Pink/Black/Cool Gray colorway is slated for next year.