Nike Withdraws Full-Year Guidance, Postpones Investor Day

By Sabela Ojea

Nike is withdrawing its guidance for the year and postponing its first investor day in seven years to evaluate the direction of the company following the appointment of Elliott Hill as chief executive.

Shares fell 5% to $84.71 in postmarket trading Tuesday. The stock has dropped 18% since the beginning of the year.

The sportswear company, which had most recently guided for full-year revenue to be down mid-single digits, on Tuesday said both decisions would give Hill time to evaluate Nike's current strategies and business trends, as well as develop plans to best position the business for fiscal 2026 and beyond.

For the second quarter, Nike said it expects revenue to be down 8% to 10% as it deals with higher promotions and lower benefits from its pricing actions. Analysts polled by FactSet expect second-quarter revenue to be down 6.7%.

The company didn't provide details about another date for its investor day, which had been scheduled for Nov. 19.

Nike's change of plans comes as it reports a 10% drop in revenue in its fiscal first quarter ended Aug. 30 after delivering lower-than-expected unit sales, finance chief Matt Friend said on a call with analysts.

"Progress with partners will be accelerating through new brand momentum and new energy with consumers, but the multibrand environment is very competitive today and it will take time to expand market share," Friend said.

The company is seeking to recapture growth with Hill on the top job following years of missteps under the leadership of retiring Chief Executive John Donahoe.

Donahoe cut Nike's ties with longtime retail partners such as Foot Locker, DSW and Macy's, enhanced its online capabilities, and tried selling more merchandise directly to consumers, a strategy that is at the core of Nike's problems.

Write to Sabela Ojea at sabela.ojea@wsj.com

(END) Dow Jones Newswires

October 01, 2024 18:21 ET (22:21 GMT)

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