Nike shares plunge after sneaker giant warns sales could fall by double digits

Core Viewpoint - Nike's shares have significantly declined as investors express concerns over new CEO Elliott Hill's turnaround strategy, particularly after the company warned of potential double-digit sales drops [1][2]. Sales Performance - Nike reported a 9% sales decline during the holiday season quarter, with a notable 17% slump in quarterly sales in China [1]. - The company anticipates a sales decrease in the "mid-teens range" for the quarter ending in May, exceeding Wall Street's expectation of an 11.4% decline [2]. Strategic Initiatives - CEO Elliott Hill has introduced a "Win Now" strategy aimed at regaining market share, focusing on enhancing presence in key cities like Shanghai and Beijing [4]. - The company is attempting to revive its sales strategy by re-engaging with traditional retailers after previously reducing their number [9][10]. Market Challenges - Nike faces challenges from weak consumer demand, a turnaround that has yet to yield results, and the impact of a 20% tariff on goods from China implemented in March [6][8]. - The company is also navigating external factors such as geopolitical dynamics, volatile foreign exchange rates, and tax regulations that affect consumer confidence [8]. Competitive Landscape - Nike is encountering stiff competition from emerging brands like Hoka and On, prompting the company to adapt its strategies to maintain market relevance [9][12]. - The company has launched new products, such as the Pegasus Premium and Vomero 18, to address previous management's missteps regarding product innovation [12].