“we believe that China will continue to be a headwind on the top line and on margin for the balance of fiscal year 2026.”

In context

“the business up for a foundation of success. When I look at our inventory being down NIKE's inventory being down 11%, versus the prior year, I think we're seeing the fruit of that, and we feel good about where marketplace inventory levels are as well. The challenge is what Elliott highlighted, which is that while we can invest to keep the marketplace clean and healthy, it's an expensive operating model if sell-throughs don't improve to the level that we need to see on a season in and season out basis. And so all of the actions that Elliott referenced are really our focus on trying to improve sell-through to create brand distinction in that marketplace, which will result in or should result in greater profitability. But in the near term, we think it's going to take time. And so that's why we believe that China will continue to be a headwind on the top line and on margin for the balance of fiscal year 2026. Last quarter, we referenced a few pilots that we were working on, and that our teams are working on, and we had a chance to see them when we were in China a few weeks ago. We're actually encouraged by the progress that the teams are making on these initial store pilots. But there's a little bit more work that needs to be done because while they're outperforming the broader fleet, we'd like to see them do a little better before we start to scale with our partners. And we've got great relationships with our partners in that marketplace. And so we're confident that once we get these pilots performing the way that we want to, both we and our partners are prepared to invest to turn the business in the direction that we want to head. Operator: The next question comes from John Kernan with TD Co”