Nike on Thursday posted quarterly earnings and revenue that topped Wall Street’s estimates, as strength in North America helped to offset a plunge in China sales.

The company’s stock slid more than 6% in extended trading Thursday, as investors digested the weakness in China and the sustained hit Nike is taking from higher tariffs.

Here’s what Nike reported for its second fiscal quarter of 2026, according to consensus estimates from LSEG:

• Earnings per share: 53 cents vs. 38 cents expected
• Revenue: $12.43 billion vs. $12.22 billion expected

The athletic apparel retailer said sales in North America rose 9% to $5.63 billion. But revenue in its Greater China market dropped 17% to $1.42 billion.

The sneaker company is just over a year into CEO Elliott Hill’s turnaround strategy, focusing on regaining its growth and market share, clearing out old inventory and investing in wholesale relationships.

“Fiscal year ’26 continues to be a year of taking action to rightsize our classics business, return Nike digital to a premium experience, diversify our product portfolio, deepen our consumer connection, strengthen our partner relationships and realign our teams and leadership,” Hill said on a call with analysts. “And I say we’re in the middle inning of our comeback.”

“We’re nowhere near our potential,” he added.

Hill said Nike’s improvements in its China market are “not happening at the level or the pace we need to drive wider change,” though he said the country remains one of the company’s most powerful long-term opportunities.

Nike expects fiscal third quarter revenues to fall by a low single digit percentage, with modest growth in North America. It also anticipates gross margins will drop 1.75 to 2.25 percentage points – including a 3.15 percentage point hit from tariffs.

The company said wholesale revenues climbed 8% to $7.5 billion during the quarter. But direct sales — which were a focus for Nike in the years before Hill took over and moved away from the strategy — fell 8% to $4.6 billion.

Nike has also been feeling the impact of tariff increases. It said Thursday that its gross margin decreased by 3 percentage points and inventories dropped 3% primarily due to higher tariffs.

The sneaker company has been reporting weakness in its Converse brand, too. In its first fiscal quarter, Nike said Converse sales dropped 27% – on Thursday, it reported a 30% drop in revenues for the sneaker brand.

Despite the weakness in some parts of Nike’s business, the company highlighted some areas of strength and new initiatives ahead. CFO Matt Friend said on the call that Nike.com posted its best Black Friday ever this year, partially driven by its Air Jordan “Black Cat” launch.

Nike also plans to launch a new footwear platform in January called Nike Mind, which aims to help athletes prepare for performance and competition, Hill said on the call.

Nike has been making larger internal changes under Hill.

Earlier this month, Nike underwent leadership changes to “remove layers,” according to Hill. Under its “Win Now” strategy, the company announced that Chief Commercial Officer Craig Williams would leave the sneaker giant.

Hill called the shakeup a move “about growth and offense.”

“Collectively, these changes amount to us eliminating layers and better positioning Nike to continue to have an impact the way only Nike can,” Hill said in a statement at the time.

Nike shares have dropped more than 13% this year as of Thursday’s close.

American Airlines customers flying on basic economy fares will no longer earn frequent flyer miles or points toward elite status, the carrier said this week.

“We routinely evaluate our fare products to remain competitive in the marketplace. Customers who purchase a Basic Economy ticket on December 17, 2025 and beyond will not earn AAdvantage miles or Loyalty Points towards AAdvantage status,” it said. “Basic Economy customers will continue to receive one free personal item and one free carry-on bag, free snacks, soft drinks and in-flight entertainment.”

Elite loyalty members will still be eligible for first-class upgrades on domestic flights if they’re on basic economy tickets, an American spokeswoman told CNBC.

Basic economy tickets are airlines’ cheapest but most restrictive fares, rolled out across the industry over the past decade. Generally, they do not allow customers to change their tickets without fees or pick their seats in advance.

The move comes as airlines across the board have been chasing customers who are willing to spend more to fly. American has fallen behind large rivals Delta Air Lines and United Airlines in the post-Covid luxury travel boom.

American’s change, posted earlier by X user JonNYC, follows a similar policy by competitor Delta Air Lines, which said travelers on its Delta Main Basic, or basic economy tickets, wouldn’t receive Delta SkyMiles.

United Airlines does allow its MileagePlus loyalty program members to earn miles on basic economy tickets, but it has a different limitation: Basic economy customers on most flights aren’t allowed to bring a carry-on bag.

American had the same restriction after it launched basic economy fares but backpedaled in 2018.

Southwest Airlines this year launched its first no-frills basic fares that stipulate those customers will board last and get a seat assignment at check-in and earn miles at a lower rate than more expensive fares.