Nike Plummets to Lowest in Decade as Turnaround Sputters

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.

Bloomberg Retail Reporter Lily Meier joins Paul Sweeney and Scarlet Fu on Bloomberg Intelligence to discuss. After Nike Inc. announced a disappointing forecast for the year ahead, sending the company’s shares tumbling, Chief Executive Officer Elliott Hill convened the staff as he does after every earnings. This time, he had frustrations to air.

“I’m so tired, and I know you are too, of talking about fixing this business,” Hill said during the all-hands meeting Tuesday, according to a recording reviewed by Bloomberg News. “I want to move to inspiring and driving growth and having fun.”

Nike shares fell as much as 15% on Wednesday to the lowest intraday since October 2014. The company told investors that revenue is expected to drop in the current quarter and decline for the rest of the calendar year. Weakness in Greater China and free-falling Converse sales are among management’s biggest challenges. “You can’t just sit there and say everything’s great,” Hill said, referring to the investor call during which Nike issued guidance. “Frankly, it needed to be different.”

A Nike spokesperson said the company summons employees after every quarter to reinforce what was shared with investors and align on the work ahead.

“It was a direct conversation about where we are seeing real progress, where we need to move faster, and what it will take to win,” the spokesperson said in an emailed statement. “The discussion reflected the same reality we shared externally: urgency, transparency, focus and a determination to restore growth.”

When Hill took over in October 2024, he worked to erase some of the moves of his predecessor, refocusing the business on sports and building back the company’s relationships with wholesale partners. Despite the strategy shift, Nike shares are down about 45% since he took over.

Hill said that parts of his strategy “took longer, way longer than I’d like.” The company’s results have been mixed, with areas like North America and running improving, but progress hasn’t met investors’ expectations.

Chief Financial Officer Matthew Friend discussed Nike’s forward outlook during the all-hands, saying that “the trajectory for the business was stepping down.”

Friend told employees that they needed to be careful with their budgets, only spending where it makes sense.

“We’re going to be managing costs carefully as we have been doing,” the CFO said. “I realize that that creates a tension inside, but I just need you to know that the reason why that tension is there is because our business is not moving in the right direction.”

“I hate to lose, and we’ve got work to do in some of these places,” Hill added.

--------

Watch Bloomberg Radio LIVE on YouTube

Weekdays 7am-6pm ET

Follow us on X

Subscribe to our Podcasts:

Bloomberg Daybreak

Bloomberg Surveillance

Bloomberg Intelligence

Balance of Power

Bloomberg Businessweek

Listen on Apple CarPlay and Android Auto with the Bloomberg Business app:

Apple CarPlay

Android Auto

Visit our YouTube channels:

Bloomberg Podcasts

Bloomberg Television

Bloomberg Originals