No items found.

Nike Banking on Key Wholesale Partners to Deliver


Nike senior executives, who last week described the company’s current FY24 as “the turning point” for driving more profitable growth, expect key global wholesale partners such as Dick’s Sporting Goods in the U.S. and Zalando in Europe to generate high-single to low-double digit brand sales increases for the 12 months ending May 31, 2024. Those anticipated gains coupled with an expanding direct business will help Nike achieve its annual outlook of mid-single digit revenue growth, 140- to 160-basis point gross margin expansion, and modest markdown improvement. The company is eyeing a refreshed portfolio of basketball products, performance and lifestyle running merchandise and the next evolution of Air to direct the sales growth.

Last week, despite some bear chatter over a 9 percent stock price drop over the prior four weeks, Nike delivered Q1 results ahead of expectations. While average selling prices (ASPs) were higher in both footwear and apparel across all geographies, total revenues rose by 2 percent to $12.94 billion. Gross margin, improved on an operational basis but negatively impacted by currency headwinds, dipped 10 basis points to 44.2 percent. Year-over-year inventory was 10 percent to nearly $8.7 billion that included a double-digit decline in units. Wholesale sell-in is forecast to accelerate again in the second half when lower freight and product costs and currency headwinds should each positively impact margins.

In North America, Nike said it generated strong full-price sales in the run specialty channel where it introduced the Infinity 4. Overall regional sales declined by 1 percent to $5.42 billion but sales increased by 7 percent in the direct and digital channels and by 11 percent in stores, aided by new technical fleece product and a double-digit jump in the Jordan Brand.