For the quarter ended on November 30th, revenue fell about 8% to $12.35 billion, but still surpassed LSEG’s estimate of $12.13 billion. During the quarter, store and online sales contracted by 13% while wholesale revenues dropped 3%.All four geographical regions recorded declines in sales, but besides China, results were better than expected. In North America, sales declined 8% to $5.18 billion, but still topping StreetAccount’s $5.01 estimate. Europe, Middle East and Africa sales dropped 7% to $3.30 billion, also topping StreetAccount’s estimate of $3.26 billion. Asia Pacific and Latin America, reported sales dropped by 3% to $1.74 billion, yet also topped analysts’ consensus estimate of $1.62 billion. But China reported sales declined 8% to $1.71 billion which was worse than StreetAccount’s $1.75 billion estimate. Converse also dragged down the results as sales fell 17% during the quarter.

New CEO Elliott Hill outlined his strategy to return the company to growth, with the top and bottom line declines being blamed on deep discounting as promotions were used to fuel sales. Together with CFO Matt Friend, the two executives stated that Nike needs to aggressively liquidate old inventory through “less profitable channels” before returning its online business to a full-price model. Moreover, Nike’s markdowns do not only hurth the brand but also disrupts the overall marketplace and the profitability Nike’s partners. Consequently, Nike gudied for holiday quarter gross margin to drop between 3 and 3.5 percentage points.

Hills also spoke of Nike’s lack in product newness and inspiring stories. By falling behind on innovation, Nike lost market share and Hill, who kicked off his professional journey as Nike’s intern in the 1980s and left the company in 2020, is now back o turn things around, inside and out. But latest results show that getting back to winning is a challenging task, however, one that Hill is determined to fix by corecting the actions of his predicisiours such as restoring the trust of wholesale partners, such as Foot Locker Inc (NYSE: FL). Along with Dick’s Sporting Goods Inc (NYSE: DKS), Foot Locker will undoubtedly rejoice as their sales heavily rely on the brand. On December 4th, Foot Locker missed Wall Street’s estimates both when it comes to top and bottom lines. Partly due to soft demand for Nike’s product, Foot Locker fell short with its third quarter results.