NIKE(US:NKE) Haitong Securities International·2025-07-04 09:50Investment Rating - The report does not explicitly provide an investment rating for the industry or specific companies within it [4]. Core Insights - The offline retail sales performance of sportswear brands in Southwest China was under pressure in 2Q25, primarily due to weak consumer spending, with major brands experiencing negative sales growth [2][6]. - NIKE's sales in Southwest China saw a significant year-on-year decline, while ADIDAS performed slightly better with a high single-digit to low double-digit decline [2][6]. - Outdoor brands like Columbia and The North Face showed better performance due to strong demand for outdoor activities, camping, and tourism [2][6]. - The summer sports shoe market is facing sluggish consumption in traditional categories, but there is a rising trend in outdoor and fashion footwear [2][6]. Summary by Sections Offline Retail Performance - In 2Q25, offline retail data for sports brands in Southwest China weakened compared to 1Q25, with all major brands reporting negative sales growth [2][6]. - Store traffic remained stable, but transaction rates and average customer spending declined due to weak consumer purchasing willingness [2][6]. Brand Performance - NIKE's focus on footwear has led to a decline in its apparel market share, while ADIDAS maintained stable discount levels and focused on apparel sales, contributing to its relatively better performance [4]. - FILA's sales decline has narrowed, and the brand is shifting towards professional sports categories, enhancing its market position [4]. - LI-NING has become a partner of the Chinese Olympic Committee, while Anta is expanding into the outdoor cycling market [4]. Inventory and Discounts - Inventory levels are slightly elevated, leading to increased discounting across brands, with LI-NING and Anta offering the highest discount rates [3][4]. - The discount intensity for outdoor brands varies, with PELLIOT offering the highest discounts [3][4]. Future Outlook - The report anticipates that outdoor brands will perform better in the second half of the year, driven by increased sales in outdoor activities [4].