### Nike's Recent Report Brings Mixed Reactions Amid CEO Change

Nike's latest quarterly report brought no major surprises, aligning with market expectations. According to Morningstar equity analyst David Swartz, the sportswear giant had been signaling since December 2023 that both the sportswear market and its innovation cycle were showing signs of weakness. As Nike navigates the beginning of fiscal year 2025, it finds itself with a limited pipeline of new products and has begun scaling back on some existing offerings.

The quarterly report is also notable for being the first since Nike announced a significant leadership change. On October 14, Elliott Hill, a former Nike executive who retired in 2020, will step in as CEO, replacing John Donahoe. This news initially buoyed Nike's stock, which jumped by as much as 10%. Despite this brief rally, Nike's stock had previously slumped by more than 25% this year amid declining sales growth and increasing competition from brands such as On and Deckers' Hoka.

David Swartz commented that the sportswear industry has become significantly more competitive over the past five years, a shift Donahoe acknowledged too late. Looking ahead, Nike has tempered its revenue expectations for the current quarter, forecasting a decline between 8% and 10%, which falls short of Wall Street's earlier projection of a 6.7% decrease. This quarter also marked the sixth consecutive period where Nike has reported single-digit revenue growth or worse.

Contributing to the overall uncertainty, Nike announced on Tuesday it would postpone its upcoming investor day without providing a future date. Analysts like Randal Konik of Jefferies believe the new CEO, Elliott Hill, will not significantly influence the company's performance until the fiscal year 2026. Consequently, Konik expects Nike's shares to remain relatively stable but range-bound for the coming quarters.