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When Nike brought Elliott Hill out of retirement almost two years ago to helm the sports conglomerate, it was with the intention of turning the brand\u2019s strained relationships with athletes and retailers around in what Hill would later call a \u201csport offense.\u201d\u00a0<\/p>\n
That offensive strategy seemed to pay off\u2014in North America at least\u2014when Nike\u2019s quarterly earnings exceeded Wall Street\u2019s expectations. The company reported an adjusted 20 centers earnings per share, compared to the 13 cents expected. It also reported $10.97 billion in revenue, a $130 million increase from the expected $10.86 billion. And thanks to a nearly billion dollar tariff refund ($986 million), the company\u2019s gross margin increased 8.9% during the quarter\u2014even if analysts excluded the gain in their earnings expectations.<\/p>\n
The Nike veteran is facing two report cards. There\u2019s the one after the bell today that demonstrates what real progress Hill has made on stemming Nike\u2019s losses (for the past two years, Nike\u2019s sales fell every single quarter with shrinking profit margins and money earned per share dropping by almost two thirds). But he\u2019s also facing the one on the world stage that\u2019s playing out in stadiums across the United States, Mexico and Canada. The World Cup could show whether his efforts to rejuvenate Nike\u2019s sports culture into something consumers really want, if it really paid off.\u00a0<\/p>\n
Hill inherited a company in freefall: negative 5% year-over-year revenue growth and the start of what would become a 62% decline in earnings per share from its peak in May 2024. Since his first quarter as CEO in November 2024, earnings per share, a number investors keep a close eye on, is down 56%\u2014hitting $1.51 per share\u2014and operating income is down by half.\u00a0<\/p>\n
Nike brought back Hill to fix its relationship with retailers like Dick\u2019s Sporting Goods after his predecessor John Donahoe aggressively pursued direct-to-consumer sales in a digital strategy that Hill said made Nike\u2019s partners \u201cfeel we\u2019ve turned our back on them.\u201d And so Hill focused his tenure on rebuilding Nike\u2019s shelf presence.\u00a0<\/p>\n
Going on a sport offense meant shifting Nike from designing for women, men and kids to designing with different types of athletes in mind, for a more \u201csport-led\u201d approach to maximize innovation, Hill explained at a May 2026 talk at UC Berkeley\u2019s Haas School. The earnings report as clearly on his mind last week when he told the FT<\/em> that this restructuring was taking longer than he\u2019d anticipated. \u201cJob\u2019s not done until the job\u2019s done,\u201d Hill said. \u201cI guess Wall Street will be the judge of that, right?\u201d<\/p>\n His efforts seem to be paying off in North America: revenue growth is up 15 percentage points since the lowest point under Donahoe.<\/p>\n A portion of Hill\u2019s strategy involved bringing Nike on par with Adidas on the world stage. While the rival is an official FIFA partner, Nike outfits 12 teams with kits and uses advertising to compete. He told investors on the March earning call that soccer is next in the sport offense with the new Mercurial footwear, Tiempo cleats and Aero FIT national kits, asserting that Nike is \u201cutilizing the World Cup as an opportunity to catalyze the football marketplace for quarters to come.\u201d<\/p>\n Nike will face off against Adidas to make the most of the World Cup as the two compete through ad campaigns, with Nike featuring superstar athletes Cristiano Ronaldo, Kylian Mbappe and LeBron James (juxtaposed with Adidas\u2019 ads featuring Lionel Messi). The decades-long rivalry is not just about bragging rights: It\u2019s the first big global stress test of Hill\u2019s approach to driving up Nike demand. To meet this end, Nike also overhauled its previous playbook by adding celebrities like Kim Kardashian and K-pop star Lisa to its \u201cRip the Script\u201d ad campaign, which gathered over 78 million views, as compared to Adidas\u2019s 7.8 million in the last month.\u00a0<\/p>\n \u201cThere\u2019s a reason why Nike is spending that kind of money on those ad campaigns at the World Cup,\u201d David Swartz, a senior equity analyst for Morningstar, told Fortune<\/em>.<\/p>\n The company said the goal of the ad was to give fans \u201csomething worth talking about, worth clipping, worth wearing, worth showing up to,\u201d a seeming attempt to turn the enthusiastic culture around the World Cup into Nike demand.\u00a0<\/p>\n \u201cNike is very visible during the World Cup and it can generate sales directly, because people do buy jerseys for those national teams and for the players that they like,\u201d Swartz told Fortune<\/em>. \u201cIt\u2019s also a big branding opportunity in the long term to try to get Nike back in the forefront of the sportswear world, where it typically has been, but has lately fallen behind.\u201d<\/p>\n While Tuesday\u2019s report showing North American growth matters for Nike, Swartz told Fortune<\/em> that regaining market share in China\u2014where Nike is losing out to Chinese footwear company Anta\u2014matters all that much more. Today\u2019s earnings show China results for Nike as weak but in line with expectations. Nike\u2019s China revenue fell from over $7B (when Hill started) to $6B as of February\u2019s quarterly data and is projected to fall to $5.5B through August because of competition and inventory glut.\u00a0<\/p>\n \u201cIts profitability in China has just collapsed, which has been a big problem because historically it was Nike\u2019s highest margin region,\u201d Swartz said. \u201cThe main concern right now for investors probably is how long is it going to take for Nike to get a turnaround in China.\u201d<\/p>\n There\u2019s also the concern that Nike has fallen behind on innovation, with no new and exciting sportswear products to attract consumers, an issue compounded by the tariffs and high gas prices that have been squeezing consumer companies generally. Retailers in China are also having difficulty selling Nike merchandise, even at a discount, which continues the inventory glut and takes up shelf space that could hold new products, according to Swartz.\u00a0<\/p>\n \u201cUtlimately, Nike needs to have more full price selling and less discounting of its products to get its margins back up,\u201d he added.\u00a0<\/p>\n<\/div>\n #Nikes #earnings #exceeded #Wall #Streets #expectations #CEO #Elliott #Hills #test #World #Cup<\/p>\n","protected":false},"excerpt":{"rendered":" When Nike brought Elliott Hill out of retirement almost two years ago to helm the sports conglomerate, it was with the intention of turning the brand\u2019s strained relationships with athletes… <\/p>\n","protected":false},"author":1,"featured_media":9943,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[369,3826,457,11821,11820,2967,11822,6546,11819,2895,3110,1152,51,1965],"class_list":["post-9942","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-finance-news","tag-ceo","tag-cup","tag-earnings","tag-elliott","tag-exceeded","tag-expectations","tag-hills","tag-nike","tag-nikes","tag-streets","tag-test","tag-wall","tag-world","tag-world-cup"],"_links":{"self":[{"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/posts\/9942","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=9942"}],"version-history":[{"count":0,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/posts\/9942\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/media\/9943"}],"wp:attachment":[{"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=9942"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=9942"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=9942"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}Nike\u2019s World Cup moment<\/strong><\/h2>\n
From dominating footwear to declining sales<\/strong><\/h2>\n