By Sabela Ojea

Nike posted lower profit and sales in its latest quarter, as the company stepped up discounts to clear inventory in the early days of a turnaround under its new chief executive.

The sportswear brand on Thursday posted a profit for the three months ended Feb. 28 of $794 million, or 54 cents a share, compared with $1.17 billion, or 77 cents a share, for the same period a year earlier. Analysts polled by FactSet had forecast earnings of 30 cents per share.

Sales fell 9.3% to $11.27 billion in its fiscal third quarter, beating the $11.02 billion expected by Wall Street, according to FactSet. Direct revenue dropped 12%, while wholesale revenue fell 7% to around $6.2 billion.

In North America, the company saw a sequential improvement in sales, which were down 4% at $4.86 billion, driven by its core footwear segment. Sales in China and the company's Europe, Middle East and Africa region also saw declines of 17% and 10%, respectively.

Chief Executive Elliott Hill said Nike is making progress against its turnaround plan and is confident the company is on the right path.

"The operating environment is dynamic, but what matters most for Nike is serving athletes with new product innovation and re-igniting brand momentum through sport," Hill said.

Hill returned to Nike in October, succeeding John Donahoe, with the aim of bringing new products that resonate well with the consumer and strengthening relationships with key wholesalers such as Foot Locker.

As part of the plan, Nike is also cleaning up inventory to win back shelf space to fill with new products and while turning around its digital business, which the company said had become a platform it used to compete with its wholesale partners rather than creating and growing demand for its products.

Some of the steps Nike is taking to refresh its storytelling and brand image have included its first Super Bowl ad in nearly three decades, and the announcement of a new brand with Kim Kardashian's Skims that targets women's activewear and is expected to launch in spring.

Write to Sabela Ojea at sabela.ojea@wsj.com; @sabelaojeaguix

(END) Dow Jones Newswires

March 20, 2025 16:43 ET (20:43 GMT)

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