Elliott Hill, the company’s new CEO, stated on Thursday that Nike must return its focus to basketball courts, soccer fields, and running trails.
Reputting sport at the heart of everything we do is Nike’s top priority, according to Hill’s first earnings report as the company’s CEO.
Although the company’s quarterly revenue of $12.4 billion was down 8%, it was still better than the 9% decline that Wall Street analysts had predicted. Within half an hour of the earnings announcement, Nike’s stock was up 8% in after-hours trade.
On October 14, Hill, a well-liked insider, began working.
His first remarks regarding the company were made in public during Thursday’s results announcement.
In a news release, he stated, “We’re taking immediate action to reposition our business so we can get back to driving long-term shareholder value.” Our staff is prepared, and I have no doubt that you will witness more instances of Nike becoming Nike once more.
Nike made significant investments in direct sales and throwback sneakers under former CEO John Donahoe. These strategies were successful in the early stages of the pandemic but later backfired when smaller, more agile competitors took over the shelf space Nike had left empty, even at running stores.
Nike began a $2 billion cost-cutting initiative a year ago. It declared in February that it will reduce 2% of its personnel worldwide, which ultimately comprised over 700 workers in Oregon, including a sizable number of managers and executives.
Prior to his last day as CEO, Donahoe unveiled a turnaround plan that included rebuilding Nike’s wholesale business, putting more of an emphasis on sports, improving marketing, and bringing goods to market more quickly.
Nike’s recent actions indicated that Hill will continue to emphasis on sports, even if Thursday was his first public statement as CEO. The company’s agreements with the WNBA, NBA, and NFL have been extended by 12 and 10 years, respectively, since he began working there. Additionally, a division of the business that produced virtual footwear for the metaverse was shut down.
We’ll be updating this story.
Matthew Kish covers business, notably the banking and sportswear sectors. You can reach him at @matthewkish, [email protected], or 503-221-4386.
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