Nike talks the talk… but finds it isn’t as easy to walk the walk Nike is a hot mess of cognitive dissonance. Despite a number ofcampaignstouting equality for female athletes, Nike faces scrutiny for internal practices that hurt women. As 2019 -- the year Nikedeclaredthe “year for women” -- comes to a close, it’s worth looking back on notable hits and misses. Nike paints a pretty picture Nike has a knack for values-based messaging. After 2018’s “Dream Crazy” campaign with Colin Kaepernick -- whichwonmultiple awards and boosted sales -- it launched a “Dream Crazier” campaign telling the tales of top female athletes like gymnast Simone Biles, fencer Ibtihaj Muhammad, and members of the US Women’s National Soccer Team -- all narrated by tennis GOAT Serena Williams. But all’s not well in Beaverton In May, Olympic sprinter Allyson Felix penned an explosiveop-edin theNYTdetailing how Nike’s sponsorship policies unfairly penalize female athletes who get pregnant. Felix later cut ties with Nike and inked adealwith Athleta. Then in November, Mary Cain, a record-breaking track and field athlete, published anop-edclaiming emotional and physical abuse at the hands of track coach Alberto Salazar. Salazar, who helmed Nike’s elite Oregon Project, was banned from coaching after the US Anti-Doping Agency found he urged athletes to use performance-enhancing drugs. Cain said he body shamed her toward dangerous weight-loss goal... and other athletes corroborate her allegations. Earlier this month, hundreds of Nike staffmarchedacross the Nike campus in Beaverton, Oregon, to call for the company to make real changes in empowering female athletes and employees. The protest was tied to Nike’s reopening of a building named for Salazar. A flier for the event read: “Walk the Talk, Do the Right Thing.” Don’t get your Dri-Fit in a wad Nike seems committed to accommodating female athletes -- and that goes for the recreational as well as the professional. This week, Nike announced thelaunchof its Victory swimsuit. Designed with Muslim modesty in mind, the Victory suit has required some truly technical considerations. Although wearers won’t be as equipped to compete as swimmers wearing, say, Speedo’s Fastskin, the Victory suit points to a cultural shift that sees athletics as something more than competitive sports. Rather, physical activity is something crucial to a woman’s identity and self-esteem.
Nike Posts Higher Sales in U.S., China Despite split with Amazon and controversy over track coach, sportswear giant logs 10% gain in revenue Nike’s sales in its latest quarter rose 5% in North America, its biggest market, and 20% in Greater China. Photo: Justin Sullivan/Getty Images By Kimberly Chin Updated Dec. 19, 2019 6:12 pm ET Nike Inc. NKE -1.29% posted a 10% jump in sales in the latest quarter, even after the sportswear giant decided to stop selling through Amazon. com Inc. and faced criticism for its support of disgraced running coach Alberto Salazar. Revenue in the North American market, which accounts for the majority of Nike’s sales, rose 5% from a year ago. The gains were driven by footwear, as apparel sales were flat. The fastest-growing region was Greater China, where revenue jumped 20% from a year ago. Executives said apparel sales were flat in North America because of the boost that business got a year earlier, when basketball star and Nike endorser LeBron James joined the Los Angeles Lakers, lifting sales of his jerseys. Nike has the exclusive rights to make National Basketball Association jerseys. Nike’s shares, which have climbed 36% this year, were down 2% at $99.25 in after-hours trading. In November, Nike said it would stop selling its clothes and sneakers directly on Amazon to focus on its own apps and stores. The company sold a relatively small amount of goods on the site, though many third parties resell Nike products there. Instead, Nike has tried to drive consumers to its own shopping apps and reduce its reliance on traditional retailers. In the latest quarter, Chief Executive Mark Parker said digital revenue rose 38% from a year ago, including a jump of more than 70% on Black Friday in North America. For the fiscal second quarter ended Nov. 30, Nike reported a profit of $1.12 billion, or 70 cents a share, up from $847 million, or 52 cents a share, a year ago. Overall sales were $10.3 billion for the quarter and exceeded analysts’ estimates of $10.1 billion. The company expects a high single-digit-percentage increase in reported revenue growth for the full fiscal year, finance chief Andy Campion said on a conference call. Nike expects growth in the third quarter to be in line with the first quarter, when revenue rose 7%, he said. During the quarter, Nike came under scrutiny for its silence on the Hong Kong protests and its support for Mr. Salazar, who received a four-year ban for doping. Mr. Salazar has said he planned to appeal the sanction. He also has disputed allegations from some former female athletes that he mistreated them. On Oct. 1, Mr. Mark Parker sent an email to Nike employees saying the company would never condone cheating and underscoring his support for Mr. Salazar. A few days later, Mr. Parker said the company was disbanding the Nike Oregon Project, an elite running team Mr. Salazar coached. About two weeks later, Mr. Parker said he would step down as CEO in January and become executive chairman. John Donahoe, a former eBay Inc. chief executive and a current member of Nike’s board, will take over as CEO in January. “This has been a very thoughtful transition that has been planned for many months,” Mr. Parker said on Thursday. “Our brand and our business are as strong as they’ve ever been.” Write to Kimberly Chin at kimberly.chin@wsj.com https://www.wsj.com/articles/nike-posts-higher-sales-in-u-s-china-11576793641
Nike Stock Beat the S&P 500 in 2019. Here’s How. By Connor Smith Dec. 31, 2019 11:44 am ET Order Reprints Print Article Text size Nike stock has soared nearly 36% this year as of afternoon trading on Dec. 31.Photograph by Drew Angerer/Getty Images With the year almost over, we’re takinga look at all 30 stocks in the Dow, starting with the worst performer—Walgreens Boots Alliance—and working our way up to the highest-flying stock in the benchmark—Apple.The ranking may shift before the close of 2019 trading, but the stories behind the stocks shouldn’t. While theDow Jones Industrial Averagelagged behind theS&P 500this year, neither index could keep up withNikestock. The U.S. athletic-wear company soared 36% this year to $101.31 as of Dec. 31, dashing pastclosing price recordsalong the way. Nike (ticker: NKE) stockbeat the market in 2018too. Analysts were looking ahead to 19% upside in 2019, according to FactSet’s average price target heading into the new year. The company’s continued growth has come as retailers and brands alike balance innovations in online sales with keeping costs down. The stockcarried its momentumfrom a strong earnings report in December 2018 all the way to the mid-$80 range before itsfiscal third-quarter reportin late March 2019. Nike fell into the $70s range when the broader market dipped in May. But as the market rallied ahead of the Federal Reserve’ssummer rate cut, so did Nike stock. Not evenan uncharacteristic fiscal fourth-quarter earnings misscould quiet the bulls. And they were right. A solidearnings beat in Septemberbrought back Nike’s record for bottom-line beats, which put the stock solidly over the $90 mark in the coming weeks. Then came a shake-up. In October, Nike announced that ServiceNow CEO John Donahoe would succeed Mark Parker as chief executive in January 2020. Parker will stay on as the board’s executive chairman. The company alsopulled its productsfromAmazon.com(AMZN) in November as it focused on direct-to-consumer sales. Still, analysts havegrown increasingly bullishabout Nike’s transition toward a digitally-driven, direct-to-consumer brand. An analyst atGoldman Sachsupgraded the stock to Buy and added it to the firm’s conviction list, citing “evidence of building pricing power, signs of operating leverage, accelerating shift to differentiated retail, sharply scaling app ecosystem, and a constructive global athletic growth backdrop.” That bullishness built as the stock rallied to a record close of $101.23 on Dec. 19. The gain was somewhat short-lived, as the stock pulled back a bit when itreported quarterly earnings that evening. Raymond James analyst Matthew McClintock sees more gains ahead. He wrote in a note on Dec. 19 that he believes Nike’s innovation will soon drive “exceptional revenue growth going forward.” He raised his price target to $110 from $100. He’s not alone. The average price target for the stock was recently $110.13, according to FactSet, as a swarm of analyst raised their targets and stayed bullish. Of the 30 analysts listed by FactSet, 73% have Buy or equivalent ratings. But with the stock trading at 35 times trailing 12-month earnings, it will take even better execution to maintain that price target. We’ll soon see if upcoming CEO Donahoe is up to the task. Write toConnor Smith atconnor.smith@barrons.com
Nike’s ultra-fast controversial sneakers:Nike’s Vaporfly shoes include a carbon fibre plate and a wedge of soft, energy-returning foam that help runners move at least 4% more efficiently. The claim has been backed-up by academic studies. Since launching three years ago, the shoes have been worn to break multiple world records. While the Vaporflies have survived a ban from the 2020 Olympics, any future versions of the shoe will be outlawed. Here’s how Nike transformed the sport of running forever.(Wired) “The danger with technology is that the moment it starts to influence performance more than the normal difference between two humans, then the human integrity of the result is gone.”