Nike sales fall as company prepares to bring in new CEO

By Bill Peters

'A comeback at this scale takes time, but we see early wins,' CFO says

Sneaker maker Nike Inc. reported falling sales and profits for its most recent quarter, with management stressing that the company's turnaround would take time as it deals with weaker demand and prepares to bring aboard a new chief executive.

Nike (NKE) reported fiscal first-quarter net income of $1.05 billion, or 70 cents a share, down from $1.45 billion, or 94 cents a share, in the same quarter last year.

Sales fell 10% year over year to $11.59 billion.

Analysts polled by FactSet expected Nike to report earnings per share of 52 cents, on revenue of $11.64 billion.

"A comeback at this scale takes time, but we see early wins - from momentum in key sports to accelerating our pace of newness and innovation," Chief Financial Officer Matthew Friend said in a statement. "Our teams are energized as Elliott Hill returns to lead NIKE's next stage of growth."

Shares were down 1% after hours.

Nike reports as Elliott Hill prepares to take over as chief executive this month, replacing John Donahoe at the helm following months of results that disappointed investors.

Heading into the results, analysts were skeptical about the company's ability to immediately revive its fortunes, as shoppers remain selective following steep price increases. But some said Wall Street might be willing to look past current difficulties as they await more details on how Hill's leadership might be different.

Under Donahoe, Nike has tried to bring customers back with a more concerted focus on new products and by pulling back on the classics. As a Wall Street Journal article noted on Tuesday, the company flooded the market with too many Jordan sneakers, watering down their appeal.

Still, competition from brands like Hoka and On Running has intensified. The company's digital business has stumbled, and China, where Nike is trying to grow sales, is trying to prop up a shaky economy.

-Bill Peters

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10-01-24 1635ET

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