Nike's Quarterly Revenue Drops 10%: Slower Online Sales and Macro Uncertainty in Greater China Impact Performance

United States of America
Nike is currently the top sponsor of jerseys at the UEFA Euro 2024 football tournament.
Nike plans to sell fewer products in favor of new innovations.
Nike reported a decline in sales for its direct-to-consumer business and NIKE Brand Digital sales.
Nike, the world's largest sportswear company, experienced a 10% drop in quarterly revenue.
The company is facing weakening demand in international markets, including China.
The decline was due to growing competition from newer rivals such as On and Hoka.
Nike's Quarterly Revenue Drops 10%: Slower Online Sales and Macro Uncertainty in Greater China Impact Performance

Nike, the world's largest sportswear company, is facing a surprise 10% drop in quarterly revenue due to growing competition from newer rivals such as On and Hoka. The news sent Nike shares plunging more than 12% in after hours trading, resulting in a potential loss of $15bn in market value if the losses hold on Friday. The company also reported a decline in sales for its direct-to-consumer business and NIKE Brand Digital sales. According to Neil Saunders, Managing director of GlobalData Retail, Nike has not innovated or marketed enough and hasn't told enough stories around its products.

Nike is currently the top sponsor of jerseys at the UEFA Euro 2024 football tournament, surpassing brands like Adidas and Puma. However, the company is facing weakening demand in international markets, including China. In response to these challenges, Nike plans to sell fewer products in favor of new innovations and bet that a suite of new styles can get the company back on solid footing.

Nike reported earnings per share of $1.01 for Q4 FY2024, exceeding analysts' estimate of $0.84. However, sales decreased by 1.7% year-over-year, with revenue hitting $12.61 billion and missing analysts' expectations by $250 million.

The decline in sales growth has been a concern for analysts, as people are less willing to spend money on expensive clothes amid inflation. Nike's website traffic also dropped during the most recent quarter, with total estimated visits slipping by 5.74% compared to the same quarter of last year.

Nike executives attributed the sales miss to slower online sales, increased macro uncertainty in the Greater China region, and uneven consumer trends across Nike's markets.


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Confidence

85%

Doubts
  • Are there any other factors contributing to the decline in online sales?
  • Is the decline in sales growth solely due to people being less willing to spend money on expensive clothes amid inflation?

Sources

88%

The overall score is a weighted number that takes into account conflict of interest, bias, deception and other practices that undermine the credibility of the source. It is calculated as:
(Site Conflicts Of Interest + Author Conflicts Of Interest) / 2.0 * 0.2 + ArticleBiasScore * 0.20 + UniquePointsScore * 0.05 + DeceptionScore * 0.20 + ReadabilityScore * 0.05 + FallacyScore * 0.20

A score that takes into consideration the content for flow, interruptions with ads, and overt search engine optimization techniques that makes the content hard to understand

NKE Earnings: Nike Sinks as Sales Figures Miss Estimates

TipRanks Financial News Platform Vince Condarcuri Friday, 28 June 2024 06:49
  • Unique Points
    • Nike reported earnings of $1.01 per share for Q4 FY2024, exceeding analysts’ estimate of $0.84.
    • Total estimated website visits slipped by 5.74% compared to the same quarter of last year.
  • Accuracy
    • Sales decreased by 1.7% year-over-year to $12.61 billion, missing analysts’ expectations by $250 million.
    • Sales are expected to drop 10% during the current quarter.
    • Net income for the three-month period was $1.5 billion, or 99 cents per share, compared with $1.03 billion, or 66 cents per share a year earlier.
  • Deception (80%)
    The author provides factual information about Nike's earnings and sales figures, which are not deceptive. However, the author makes editorializing comments that could be perceived as attempting to manipulate emotions by implying that investors could have 'anticipated' the drop in sales based on website traffic data. This is a form of sensationalism and emotional manipulation. The author also selectively reports information by focusing on the negative aspects of Nike's earnings report, while failing to mention that EPS beat analysts' estimates. Additionally, the author references a tool called 'Bulls Say, Bears Say' without disclosing its source or providing any context about it.
    • It’s also worth noting that investors could have anticipated this drop by simply looking at Nike’s website traffic.
    • This isn’t surprising, as people are going to be less willing to spend money on relatively expensive clothes if inflation continues to make everyday essentials a larger part of people’s budgets.
  • Fallacies (100%)
    None Found At Time Of Publication
  • Bias (100%)
    None Found At Time Of Publication
  • Site Conflicts Of Interest (100%)
    None Found At Time Of Publication
  • Author Conflicts Of Interest (100%)
    None Found At Time Of Publication

79%

The overall score is a weighted number that takes into account conflict of interest, bias, deception and other practices that undermine the credibility of the source. It is calculated as:
(Site Conflicts Of Interest + Author Conflicts Of Interest) / 2.0 * 0.2 + ArticleBiasScore * 0.20 + UniquePointsScore * 0.05 + DeceptionScore * 0.20 + ReadabilityScore * 0.05 + FallacyScore * 0.20

A score that takes into consideration the content for flow, interruptions with ads, and overt search engine optimization techniques that makes the content hard to understand

Nike shares plunge after retailer says quarterly sales will fall 10%, warns on China weakness

CNBC News Gabrielle Fonrouge Thursday, 27 June 2024 20:32
  • Unique Points
    • Nike executives attributed the sales miss to slower online sales, increased macro uncertainty in Greater China region and uneven consumer trends across Nike’s markets
    • Nike is reducing the amount of products it has on the market in favor of new innovations and betting that a suite of new styles, along with the 2024 Paris Olympics, can get the company back on solid footing
  • Accuracy
    • Sales are expected to drop 10% during the current quarter
    • Sales into wholesalers are expected to be slower
    • Converse brand revenue plunged 18%
    • Nike is reducing the amount of products it has on the market in favor of new innovations
  • Deception (30%)
    The article contains selective reporting as it focuses on the negative sales forecast and the warning of China weakness without mentioning that Nike beat earnings estimates for the fiscal fourth quarter. The author also uses emotional manipulation by stating 'Shares plunged roughly 11% in extended trading' to create a sense of urgency and fear. Additionally, there is sensationalism with the title 'Nike shares plunge after retailer says quarterly sales will fall 10%, warns on China weakness'.
    • The expected 10% first-quarter slump is far below the 3.2% drop that analysts had expected, according to LSEG.
    • Shares plunged roughly 11% in extended trading.
  • Fallacies (85%)
    The author uses inflammatory rhetoric by stating 'Shares plunged roughly 11% in extended trading' and 'The retailer cut its guidance and said it expects sales to drop 10% during its current quarter as it warned of soft sales in China and uneven consumer trends across the globe.' These statements are not fallacies but they create a negative tone that may influence readers. The author also uses appeals to authority by quoting analysts' expectations for Nike's sales growth and revenue. However, these quotes do not constitute fallacies as they accurately report on external opinions.
    • ]Shares plunged roughly 11% in extended trading.[
    • The retailer cut its guidance and said it expects sales to drop 10% during its current quarter as it warned of soft sales in China and uneven consumer trends across the globe.
  • Bias (100%)
    None Found At Time Of Publication
  • Site Conflicts Of Interest (100%)
    None Found At Time Of Publication
  • Author Conflicts Of Interest (100%)
    None Found At Time Of Publication

96%

The overall score is a weighted number that takes into account conflict of interest, bias, deception and other practices that undermine the credibility of the source. It is calculated as:
(Site Conflicts Of Interest + Author Conflicts Of Interest) / 2.0 * 0.2 + ArticleBiasScore * 0.20 + UniquePointsScore * 0.05 + DeceptionScore * 0.20 + ReadabilityScore * 0.05 + FallacyScore * 0.20

A score that takes into consideration the content for flow, interruptions with ads, and overt search engine optimization techniques that makes the content hard to understand

Nike shares tumble as it loses ground to upstart rivals

BBC News Site: https://www.bbc.com/news/world-us-canada-68702081, About Us URL: https://www.bbc.com/aboutthebbc/ João da Friday, 28 June 2024 06:54
  • Unique Points
    • Nike faces growing competition from newer rivals such as On and Hoka
    • Neil Saunders, Managing director of GlobalData Retail, stated that Nike hasn’t innovated or marketed enough and told enough stories around its products
    • Nike is the top sponsor of jerseys at the UEFA Euro 2024 football tournament, surpassing brands like Adidas and Puma
  • Accuracy
    • Nike expects a 10% drop in quarterly revenue
    • Sales decreased by 1.7% year-over-year to $12.61 billion
    • Total estimated website visits slipped by 5.74% compared to the same quarter of last year
  • Deception (100%)
    None Found At Time Of Publication
  • Fallacies (100%)
    None Found At Time Of Publication
  • Bias (100%)
    None Found At Time Of Publication
  • Site Conflicts Of Interest (100%)
    None Found At Time Of Publication
  • Author Conflicts Of Interest (100%)
    None Found At Time Of Publication