New Nike CEO promises turnaround after declining profits

Nike reported lower profits on Thursday due to a further decline in sales, with new CEO Elliott Hill vowing to get the struggling sports giant back on track.

The athletics company, which has struggled in recent quarters with weakness in China and an oversupply of products that has depressed prices, reported a quarterly profit of $1.2 billion, down 26 percent from the same period last year.

Revenue fell eight percent to $12.4 billion, with sales declining in all four geographic divisions.

In addition to product oversupply and criticism of a lackluster product pipeline, Nike’s results suffered from the negative impact of the company’s efforts to boost direct-to-consumer sales.

These moves reduced exposure to wholesale channels and created an opportunity for smaller companies to gain market share.

Hill described his first two months as CEO as “exciting” after returning to Nike in October. He has vowed to reduce excess inventory, rekindle innovation and pursue “big, bold marketing” in keeping with the company’s vibrant heritage.

“We are repositioning the business to drive a pull market for Nike again,” Hill said, telling analysts that he sees his mission as taking the company “to a new place.”

Hill, a self-described Nike “lifer” who initially joined the company as an intern, retired from the sports giant in 2020.

At that time, as President of Consumer and Marketplace Division, he was responsible for all commercial and marketing activities for the Nike and Jordan brands.

Shares of Nike rose 0.8 percent in after-hours trading.

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