Elliott Hill outlined a clear set of priorities in December when, just two months into the job, he addressed investors and analysts on his first earnings call as Nike’s new chief executive. On Thursday, as the company reports its fiscal third quarter, he’ll have the chance to show he’s taking action.
The good news for Hill is he’s got solid victories to point to — even if the seeds of some were planted during the tenure of his predecessor.
The new Pegasus Premium and Vomero 18 running shoes have been off to a strong start as Hill tries to reassert Nike’s focus on sports. Jefferies, which upgraded Nike’s stock in February, noted both sneakers are seeing strong search interest online, while Bernstein analysts found responses to the shoes from running-specialty shops to be positive. The reception from retailers is itself a win for Nike, which has ceded shelf space in running to challengers like Hoka and is working to rebuild its relationships with retail partners after neglecting them in favour of direct sales.
It won’t be enough to offset the declines as Nike continues to clean up the overabundance of Jordans, Dunks and Air Force 1s that drove sales for years, but Hill has been blunt about expecting some pain in the process. Nike previously forecast that revenues would be down low double digits for the quarter.
Hill is sure to call out Nike’s Super Bowl ad, too, a throwback to Nike marketing of old featuring female superstars such as Jordan Chiles and Caitlin Clark that shows the company leaning back into brand building after years of over-indexing on digital performance marketing.
Another sort of brand building will be in focus as Nike ideally dishes more details on its forthcoming tie up with Kim Kardashian’s Skims, described as a new brand rather than just a collaboration. In development since late 2023, NikeSkims is expected to launch this spring and marks Nike’s latest effort in its years-long quest to appeal to more women. To that end, the company has been releasing signature sneakers for female talents like A’ja Wilson and Sabrina Ionescu, whose Sabrina 2 has become a favourite among basketball players, including a large number of guys in the NBA.
Analysts expect it will take a number of quarters for Nike to get back on course. But every journey starts with one step, and Hill needs to show he’s at least moving in the right direction.
The Week Ahead wants to hear from you! Send tips, suggestions, complaints and compliments to brian.baskin@businessoffashion.com.
