Financial Data and Key Metrics Changes - The company reported a positive comparable store sales growth in Q2, with mid-single-digit increases for new stores opened in the past couple of years [4][5] - E-commerce sales accelerated by nearly 18% in Q2 compared to Q1, indicating a strong performance in the online segment [5] - Gross margin improved by 30 basis points year-to-date, with a full-year guidance of an increase between 10 to 60 basis points [41][42] Business Line Data and Key Metrics Changes - The introduction of the Jordan brand has contributed to double-digit growth in the combined Nike and Jordan business [17] - The company has expanded its Nike assortment, increasing the square footage dedicated to Nike products by 10-15% in stores [28] - The company has seen a mid-teens acceleration in sales from customers earning over $100,000 annually, indicating a shift towards higher-income consumers [10][11] Market Data and Key Metrics Changes - Traffic from the lowest two income quintiles (under $50,000) has declined in high single digits, while the middle income quintile remains stable [8][9] - The company has successfully attracted higher-income customers, with a notable increase in sales from those making over $100,000 [10][11] Company Strategy and Development Direction - The company is focused on long-term growth through new store openings and enhancing its e-commerce platform, aiming for a 20% penetration in omni-channel sales [48] - The strategy includes expanding the Jordan brand presence in stores and leveraging customer feedback to enhance product offerings [20][21] - The company aims to maintain its core value proposition while also catering to higher-end consumers through new brand introductions [39][40] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about sustaining same-store sales growth, citing successful initiatives and a focus on value [37][38] - The company is navigating challenges related to tariffs and inflation, but believes its value positioning will help retain customers [63][64] - Management anticipates some market consolidation due to the financial pressures on companies with weaker balance sheets [80] Other Important Information - The company has successfully pulled forward inventory to mitigate tariff impacts, with inventory up 8% in dollars and 4.5% in units per store [71][72] - The capital allocation strategy remains focused on stability, with a significant portion of cash flow reinvested into the business and share buybacks [59][60] Q&A Session Summary Question: Expectations for the consumer environment in FY '5 compared to FY '4 - Management expects the environment to remain the same but acknowledges potential challenges from tariffs and inflation [63] Question: Pricing and elasticity response - Management noted varied responses to price increases, with some categories experiencing unit erosion while others remained stable [65][66] Question: Inventory growth expectations for the second half - Inventory is expected to taper off as the company manages elevated average unit retail prices [72][74] Question: Margins outlook outside of tariff costs - Management sees upside opportunities in supply chain efficiencies and cost management [75][78] Question: Competitive landscape and market share consolidation - Management anticipates some consolidation in the market due to financial pressures on weaker companies [80]