By Juveria Tabassum and Danielle Kaye
June 30 (Reuters) – Nike on Tuesday reported quarterly revenue that edged past estimates, as the world’s largest sportswear company tries to draw back shoppers and reassure investors that its turnaround push is working.
Sales continued to fall in China, which has been a weak spot for Nike in recent quarters amid domestic competition and operational missteps. But North America sales were a bright spot in the company’s fourth-quarter results, rising 3% and boosting wholesale revenue.
Nike CEO Elliott Hill, who took the helm of the company in 2024, vowed to refocus Nike on key sports like soccer and running. He has also aimed to rebuild relationships with wholesale retailers, many of which had been severed as part of former CEO John Donahoe’s pivot to a direct-to-consumer model.
But Wall Street investors have grown increasingly impatient with Hill’s nearly two-year turnaround effort, as Nike struggles to clear out excess inventory and revamp product innovation.
Nike’s shares have fallen 35% so far this year, and were down roughly 4% in volatile extended trading.
The company reported a 1% decline in fourth-quarter revenue to $10.97 billion, compared with analysts’ average estimate of $10.86 billion, according to data compiled by LSEG.
Nike’s turnaround push has also run into an increasingly tough macroeconomic environment due to tariffs and the war in Iran, and its efforts to clear out its older lifestyle-focused inventory have been a drag on margins.
Against the backdrop of a persistent sales slump, the sportswear giant has invested heavily in marketing ahead of the World Cup this year to boost revenue and brand visibility – and to help compete with rivals like Adidas.
The company reported earnings per share of 72 cents for the fourth quarter, which included a 52 cent benefit related to the expected recovery of import tariffs.
On an adjusted basis, the company reported quarterly earnings per share of 20 cents, beating estimates of 13 cents, according to data compiled by LSEG.
Nike is also looking to improve its product line-up in China by reducing selling. Sales fell 17% in the region on a constant currency basis, compared with a 10% drop in the previous quarter, and a 20% drop that Nike had projected in March.
Greater China accounts for 15% of annual sales and is Nike’s third-largest market, after North America and EMEA. But weaker product assortments and share losses to local competitors Anta and Li Ning have dampened sales in the region in recent quarters.
Nike reported a $986 million benefit from tariff refunds for the three months ended May 31. The company had said in October that tariffs were expected to cost the company around $1.5 billion.
The company had raised prices last year on some products to offset these costs. In May, consumers sued the company for not refunding tariff-related price hikes.
(Reporting by Juveria Tabassum in Bengaluru and Danielle Kaye in New York; Editing by Maju Samuel)
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