Nike falls, but surprises: what does that really mean?
Sales down, net income down 32%… and yet Wall Street applauds. Nike has just published contrasting quarterly results, revealing a still fragile but promising turnaround strategy.
A tense context
In the third quarter of fiscal 2025(ended February 28), Nike posted sales of $11.3 billion, down 9% year-on-year. Net profit fell to 794 million, compared with over one billion last year. This downward trend affected both the Nike brand (-9%) and Converse (-18%), and was felt in all geographic regions.
The Group’s own stores lost 12% of sales, and distributors were down 7%. In addition, gross margins are down(41.5% vs. 44.8% in 2024), burdened by massive promotions, inventory saturation and high production costs.
The Elliott Hill factor: a strategic return
New CEO Elliott Hill, who returned in October after a four-year break, is banking on his “Win Now” plan to reorient the brand. A former Nike executive, he seems to be reinvigorating the structure. The positive surprise? Earnings per share of 54 cents, well above the expected 28 cents.
Admittedly, the share price was down 2.55% after the close on Wall Street, but the group claims to be “on the right track”, in Hill’s words.
A possible rebound or just a reprieve?
With $1.1 billion returned to shareholders this quarter, Nike is trying to reassure. But the pressure is still on, and only real growth in key markets will restore the brand to its former glory.
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