Nike (NYSE:NKE) posted lower revenue and earnings for its fiscal third quarter of 2025, although the results exceeded Wall Street estimates.

Despite the beat, the company's guidance disappointed, with fourth-quarter sales projected to decline at the low end of the mid-teens range. Shares fell 7% in premarket trading Friday as investors reacted to the softer outlook.

Analysts responded with mixed views on the update and the company's gradual recovery.

Citi's Paul Lejuez maintained a Hold rating and lowered his price target to $72. He noted the earnings beat stemmed from stronger-than-expected sales and reduced operating expenses and taxes, but highlighted that gross margin came in below expectations.

Lejuez also pointed to elevated inventories across regions and persistent weakness in China, indicating that market may be slow to rebound. He suggested Nike's current strategy will take time to gain traction and believes earnings of $3 per share are unlikely before fiscal 2028.

Stifel's Jim Duffy also held a Hold rating with a $75 price target. While he acknowledged that Nike's third-quarter performance exceeded forecasts, he noted fourth-quarter guidance remains a drag. Duffy added that although inventory efforts are progressing, a clear return to revenue growth and operating efficiency may still be several quarters away.

Jefferies' Randal Konik, in contrast, reaffirmed a Buy rating and a $115 target. He pointed to early signs of success with new product lines and progress in reestablishing wholesale relationships. While Konik sees the turnaround lasting through fiscal 2027, he anticipates a sharp recovery and views current valuation levels as an opportunity.