Financial Data and Key Metrics Changes - Q2 revenues decreased by 8% on a reported basis and 9% on a currency-neutral basis, primarily due to franchise management actions [32] - Gross margins declined by 100 basis points to 43.6% on a reported basis, impacted by higher markdowns and channel mix headwinds [32] - Earnings per share was reported at $0.78 [33] Business Line Data and Key Metrics Changes - NIKE Direct revenues fell by 14%, with NIKE Digital down 21% and NIKE Stores down 2% [32] - The sport performance field of play grew year over year, while sportswear experienced a double-digit decline [37] - In North America, NIKE Direct declined 15%, with NIKE Digital down 22% and NIKE Stores down 3% [39] Market Data and Key Metrics Changes - In Greater China, Q2 revenue declined by 11%, with NIKE Direct down 7% and wholesale down 15% [44] - EMEA revenue decreased by 10%, with NIKE Direct down 20% and NIKE Digital down 32% [42] - APLA revenue was down 2%, with NIKE Direct declining 4% and NIKE Digital down 8% [47] Company Strategy and Development Direction - The company aims to reposition the business by focusing on sport and athlete-centric strategies, emphasizing the need to leverage its strengths [12][13] - Plans include a shift towards a full-price model and reducing reliance on promotional activities [50] - The company is committed to rebuilding relationships with wholesale partners and enhancing brand marketing efforts [26][62] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges in the current macro environment but expressed optimism about the potential for growth through strategic actions [46][49] - The focus will be on creating a consumer-led marketplace and driving innovation through sport [62][99] - Management expects Q3 revenues to decline low double digits, with gross margins down approximately 300 to 350 basis points [53] Other Important Information - The company is increasing investments in brand marketing and sports marketing to support key product launches [51] - There is a commitment to clean up the marketplace and reduce aged inventory to create space for new products [50][93] - Management is optimistic about the upcoming product pipeline and the potential for returning to growth [79][90] Q&A Session Summary Question: Can you elaborate on the relationships with retail partners and earning back shelf space? - Management emphasized the commitment to leading a consumer-led marketplace and the positive reception from wholesale partners regarding innovative products and brand statements [61][64] Question: How are you planning near-term investments in the business? - The focus will be on putting sport at the center of operations, shifting investments from performance marketing to brand marketing, and prioritizing five key sports [70][72] Question: What is the expected pressure on 2026 sales due to lifestyle acceleration? - Management acknowledged the need to reduce inventory concentration and is excited about the innovative products coming to market, which will help offset pressure [78][79] Question: How far is the company willing to take short-term actions for long-term benefits? - Management is acting with urgency to reposition the brand and is confident that the investments made will yield positive results in the long term [98][101] Question: What are the key fields of play opportunities? - The company is focusing on five key fields: running, basketball, global football, training, and sportswear, with a strong emphasis on product innovation [105]