On August 28, 2024, an employee moved shoe boxes at the Footlocker retail store at Barton Creek Plaza Mall in Austin, Texas.
Brandon Bell | Getty Images
Nike The company will report quarterly earnings on Tuesday, and investors are in for another set of less-than-ideal results. The company announced last month that John Donahoe would serve as CEO Step down.
Analysts expect the following for the world’s largest athletic shoe company in its fiscal first quarter of 2025, according to LSEG’s consensus forecast:
- Earnings per share: 52 cents
- income: US$11.65 billion
Analysts expect sales to be down 10% from the same period last year period one year ago Profits plummeted nearly 45%.
The grim outlook comes as Nike undergoes a restructuring. Last year, it was accused of lagging in innovation and development. Give share to competitors Because it focuses on selling directly to consumers through its own website and stores rather than through wholesalers like Foot cabinet and deep water shallow water area.
In September, Nike announced that Donahoe would resign and be replaced by company veteran Elliott Hill, who is scheduled to take over on October 14.
Under Donahoe’s leadership, the company’s annual sales grew more than 31%, but it took mass production traditional franchise Like the Air Force 1, Dunk, and Air Jordan 1, these weren’t the groundbreaking silhouettes that made the company a global juggernaut.
Over the past few quarters, Donahoe has spoken about the need for improved innovation and growth. repair their relationship working with wholesalers, but the company’s board of directors believes Hill, who spent 32 years with Nike before retiring in 2020, will be the right person to lead the company’s next chapter.
Donahoe is expected to attend the company’s conference call with investors on Tuesday afternoon, but observers will be eager to see if there are any clues as to where the company plans to go under Hill.
The incoming CEO will need to strengthen Nike’s innovation pipeline, reset its relationship Working with wholesalers and boosting morale after a series of layoffs and cultural collapse.
Overall, the U.S. sneaker market is relatively stagnant. Consumer spending on discretionary items like new clothes and shoes has been sluggish, making things even more difficult for Nike.
Data from Euromonitor shows that U.S. footwear sales will be almost unchanged between 2022 and 2023, and are expected to grow by only 2% this year compared with last year. The company said sneakers are expected to grow about 5.6%.
Nike’s performance has also been dragged down by China’s economic imbalance. China is Nike’s third largest market by revenue. This will be another key item worthy of attention in Nike’s financial report. Nike’s performance in China is often an indicator of the region’s financial health, and in late June the company warned of a “weak outlook” for the region. However, the People’s Bank of China recently announced biggest stimulus This is expected to give the region’s economy a much-needed boost since the onset of the coronavirus pandemic.
Nike’s fiscal first quarter was supposed to end before those stimulus measures, but executives are likely to share what sales performance looked like in the period.
Nike shares closed at $88.40 on Monday, down about 19% year to date, significantly lagging the S&P 500’s roughly 21% gain.
