National investors are watching Nike’s latest moves closely as the sportswear giant continues to grapple with a faltering turnaround. Since bringing back veteran CEO Elliott Hill in October 2024, Nike’s market value and earnings have more than halved, and the company’s core challenges remain largely unresolved.
New layoffs and a dimmer forecast
On Thursday, Nike announced another round of job cuts and projected steeper‑than‑expected declines in sales and profit for the fiscal year ending May 2028. The company warned that most of the cost‑saving benefits from its restructuring will not be realized until fiscal 2029 and 2030.
“Things are going to get worse before they get better,” said RBC Capital Markets analyst Piral Dadhania, echoing concerns that the company’s recovery timeline may be longer than investors hoped.
Key problem areas remain
Nike flagged continued weakness in three critical segments: its sportswear line, the Chinese market, and the legacy Jordan brand. Together, these areas account for more than half of total sales, underscoring the magnitude of the challenges.
China, once a major growth engine, has become a problem area. Hill acknowledged that stabilizing the market will take “multiple seasons” and will weigh on profitability.
Investor day under pressure
The upcoming investor day on November 16‑17 is now a crucial test of Hill’s strategy. Analysts expect the company to lay out a clearer roadmap for restoring growth and profitability.
“Nike really needs to show that it can at least bail out problems faster than taking them on,” said Neil Saunders, managing director of GlobalData. He added that while job cuts may buy time and support margins, they are not a solution to the underlying brand issues.
Jordan brand and product strategy
The Jordan brand illustrates the work still needed. Nike is attempting to return the franchise to premium growth by reducing the number and frequency of retro sneaker launches after years of oversupply and discounting. Hill admitted the company had “oversupplied our iconic retro product, asking them to do too much,” and noted a lack of energy in the lifestyle space has hurt traffic.
“Good thing Nike excels in running shoes because they continue to have an uphill climb ahead of them,” said Greg Zakowicz, e‑commerce and retail advisor at Omnisend.
Share price reflects investor concerns
Shares were down about 10% in pre‑market trading on Friday, hovering around $31.58 – the lowest level in 12 years and far below the 2021 peak of about $175.
Despite the bleak outlook, Hill remains committed to rebuilding relationships with retailers, refocusing product development on sports, and simplifying operations. Whether these steps will reverse the decline remains the central question for investors and analysts alike.
Original reporting: Appleton, WI News Feed (HLL/CB) — read the source article.
