KUALA LUMPUR, Dec 5 (Bernama) -- Bursa Malaysia closed lower on Friday amid mixed regional market performance as investors turned cautious over a possible rate hike by the Bank of Japan (BOJ) and upcoming US economic data that may influence the Federal Reserve’s (Fed) interest rate decision next week. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) pared most earlier losses to settle 4.55 points easier, or 0.28 per cent, to 1,616.52 from Thursday’s close of 1,621.07. The benchmark index, which opened 0.37 of-a-point lower at 1,620.70, moved between 1,609.67 and 1,621.25 throughout the day. The broader market was negative, with decliners outpacing advancers 604 to 439. A total of 550 counters were unchanged, 1,151 untraded, and 18 suspended. Turnover declined to 3.17 billion units worth RM2.24 billion from 4.48 billion units worth RM2.75 billion yesterday. Rakuten Trade Sdn Bhd vice-presiden...
Nike's new CEO, Elliott Hill, has laid out a bold plan to reposition the iconic brand after reporting second-quarter earnings that beat analyst estimates but revealed declining revenues and profits.
Key Financial Highlights
- Revenue: $12.35 billion (beat analyst estimate of $12.13 billion).
- Earnings Per Share: $0.78 (beat estimate of $0.65).
- Revenue Breakdown:
- Nike Direct: $5 billion, down 13% YoY.
- Nike Brand: $12 billion, down 7% YoY.
CEO's Observations and Strategic Shift
1. Excess Inventory and Promotions
- Hill criticized past strategies, blaming over-reliance on promotions for hurting margins.
- Plan to use Nike Value Stores to clear excess inventory and limit promotions to traditional retail moments.
- "We’ll build back an integrated marketplace across Nike Direct and Wholesale," Hill said.
2. Reinvesting in Brand and Sport
- Acknowledged that Nike shifted away from its core focus on sport, relying too much on "a handful of sportswear silhouettes."
- Plans to reinvest in brand storytelling to inspire and emotionally connect with consumers during major sport moments.
- "We lost our obsession with sport. Moving forward, we will lead with sport and put the athlete at the center of every decision."
3. Rebuilding Wholesale Relationships
- Wholesale revenue: Down 3% YoY to $6.9 billion.
- Hill admitted past neglect of wholesale partners, saying, "We stopped engaging consistently."
- Focus on mutually profitable sell-through to rebuild trust and collaboration.
Challenges Ahead
Guidance for FY 2024
- Revenue Outlook: Expected to decline by low double digits.
- Margins: Projected to contract by 300–350 basis points.
- Increased Expenses: Higher investments in demand creation expected to weigh on Q4 more than Q3.
Regional Sales Declines
- North America: -8%
- Greater China: -8%
- Europe: -7%
- Asia Pacific & Latin America: -3%
Stock Performance and Analyst Sentiment
- Nike shares closed at $77.10, up 0.26% on Thursday, but fell 0.54% in after-hours trading.
- Year-to-date, the stock is down 27.64%.
- Consensus Analyst Rating: "Buy" with a price target of $94.10, implying a 17.81% upside.
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