- Moody's changed Nike's outlook to negative and affirmed its A2 rating, citing a turnaround that is taking longer than the agency had previously expected.
- Moody's expects Nike's revenue and earnings to decline through the fiscal year ending May 2027 and into fiscal 2028, which would constrain its credit metrics.
- Nike's fiscal Q1 revenue fell 4% to $11.2 billion, with declines in Greater China partly offset by growth in North America.
- Nike expects revenue to decline in the high-single digits in 2027, and its shares fell about 6% in morning trading on Oct 2.
- The Pace operating model targets $2.5 billion in cost savings by 2031, with further job cuts beginning in calendar 2027 and beyond.
- Greater China revenue fell 26% in fiscal Q1, and Nike announced a new global campus in Bengaluru, India, alongside its Q1 results.
Quotes
“We have more work to do in NIKE Sportswear, Jordan Brand and Greater China, and we're taking deliberate actions to strengthen those businesses the right way for the long term”
“Nike is turning into a cost-cutting story, announcing a $2.5bn cost savings program as management is adapting to the reality of significant pressure within Sportswear, Jordan, and China”