Nike sees sharp drop in sales due to weak demand in China By Investing.com

Nike Inc. (NYSE:) reported a sharp decline in its revenue for the first quarter, with numbers that fell short of analysts’ expectations. The company is currently facing a decline in demand in the Chinese market, as well as strong competition from emerging brands around the world.

The sportswear giant has been hit hard by a slump in consumer spending in China, which has had a weak recovery from the pandemic. This situation is partly due to high levels of youth unemployment and a prolonged downturn in the property sector. Likewise, a change has been seen in consumer preferences in the sector regarding locally made products.

Despite efforts to boost sales by launching new products, such as the Air Max Dn and the Pegasus 41, Nike has not yet received the expected benefits from these innovations. Market analysts have noted that the company’s strategies have not been enough to stimulate demand or regain market share lost to rivals such as Deckers’ Hoka and On, the brand endorsed by Roger Federer. .

First quarter financial results revealed a drop in net income to $11.59 billion, compared to $12.94 billion in the same period a year earlier. This decline was faster than the 10% drop to $11.65 billion that analysts had projected based on estimates compiled by LSEG.

Reuters contributed to this article.

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