Nike has said it expects a surprise 10% drop in quarterly revenue,
as it faces growing competition from newer rivals such as On and Hoka. The news sent Nike shares plunging
more than 12% in after hours trading, which could mean a loss of $15bn in
market value if the losses hold on Friday. The world's largest sportswear
company also told investors it is facing weakening demand in international
markets, including in China. But Nike is optimistic that new products and a
marketing campaign at the upcoming Olympic Games in Paris will help the company
regain momentum with consumers. The company also lowered its outlook for the
2025 fiscal year. It said direct-to-consumer business declined 8%, as some
customers went for more trendy upstart brands. "There's a sense that Nike
just hasn't innovated enough, it hasn't marketed enough, it hasn't told enough
stories around its products," the Managing director of GlobalData Retail,
Neil Saunders, told the BBC. The sportswear giant's strategy to sell its
products through its own stores and website instead of wholesales like Foot
Locker hurt sales, Reuters said.
