Nike Inc. shares tumbled after the retailer gave a surprisingly gloomy outlook for the year ahead, complicating Chief Executive Officer Elliott Hill’s efforts to turn around the business.
Revenue is expected to decline 2% to 4% in the current quarter and will be down in the low single-digits for the rest of the calendar year, management told investors on an earnings call Tuesday evening. Analysts surveyed by Bloomberg had been looking for 2% sales growth this quarter and bigger gains as the year progressed.
“This is complex work, and parts of it are taking longer than I’d like,” Hill said on the call. “But the direction is clear, the urgency is real, and the foundation is getting stronger.”
Nike, which has been trying to regain market dominance after a protracted sales slump, is facing headwinds around the globe. The company is seeing elevated inventories in Europe and the Middle East and traffic disruption from the war, which it warned could lead to more volatility in its business. Those challenges, as well as weakness in Greater China and other areas, overshadowed strong results in North America.
Bloomberg Retail Reporter Lily Meier joins Paul Sweeney and Scarlet Fu on "Bloomberg Intelligence" to speak about Nike’s struggles and the pressure on CEO Elliott Hill.
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