Nike's Turnaround Is 'Going to Take Time.' Meanwhile, The Stock Is Sliding.

Core Insights - Nike is currently undergoing a turnaround, but investor confidence remains low as evidenced by a 10% drop in stock prices following the announcement of leadership changes [3][7] - The company's stock has fallen approximately 20% since the announcement of Elliott Hill's return as CEO, indicating skepticism about the effectiveness of the leadership change [2][7] Financial Performance - Nike reported a 1% year-over-year increase in revenue, reaching $12.4 billion, but profits declined by 32% to $792 million, highlighting ongoing challenges [5] - The company is facing slow sales in China and approximately $1.5 billion in annual costs due to tariffs, complicating its recovery efforts [5] Strategic Focus - Nike is working to improve "brand equity" and increase full-price sales while reducing promotions, amidst a climate of price sensitivity among consumers [4][6] - In North America, revenue increased by 9% year-over-year, with sales to wholesalers growing by 24%, indicating some success in this key market [6] Market Reaction - Despite positive revenue growth in certain areas, investors are concerned about a 10% decrease in consumer spending at Nike's website and stores, reflecting a cautious market sentiment [6] - Analysts have described the recent quarter as a "mixed bag," suggesting that while there are positive indicators, significant challenges remain [4][5]