Nike reported a 4% decline in fiscal first-quarter revenues, totaling $11.2 billion, with net income dropping 2% to $712 million. The company highlighted struggles in Greater China, although North America showed some growth.
CEO Elliott Hill emphasized the need for improvement in key segments and announced a new operating model, 'Pace,' aimed at achieving $2.5 billion in cost savings by 2031, which will involve layoffs starting in 2027. This follows previous job cuts earlier in the year, totaling 2,175 positions.
Analysts from Citi noted that Nike's sales guidance fell short of expectations, leading them to maintain a 'neutral' stance on the stock. They characterized Nike's situation as a 'cost-cutting story' and expressed skepticism about the company's ability to command a premium valuation compared to its peers, especially with significant pressures in its core markets