Nike’s stock fell more than 12% in after-hours trading as a result of the announcement; if the losses continue on Friday, the company may have lost $15 billion in market value.
The biggest sportswear firm in the world also disclosed to investors that it is seeing a decline in demand in foreign markets, particularly China.
Nike, though, is hopeful that fresh merchandise and a marketing initiative during the next Olympic Games in Paris would aid in the company’s consumer comeback.
During the earnings call, CEO John Donahoe stated, “The Paris Olympics offers us a pinnacle moment to communicate our vision of sport to the world.”
Additionally, the business reduced its projections for fiscal year 2025.
Direct-to-consumer sales reportedly fell by 8% as a result of some consumers switching to trendier upstart businesses.
According to Neil Saunders, managing director of GlobalData Retail, there’s a perception that Nike hasn’t done enough to market, innovate, or create compelling stories around its products.
Mr. Saunders went on to say that Nike needed to regain its advantage in influencing consumers to purchase its goods.
