Consumer
Nike’s Biggest Drop on Record Puts Pressure on CEO Donahoe
- Analyst says management credibility is ‘severely challenged’
- Company’s pivot to more casual footwear has sputtered
This article is for subscribers only.
Nike Inc.’s management team, led by Chief Executive Officer John Donahoe, is facing growing criticism from Wall Street as a prolonged sales slump sparked the stock’s biggest rout since the company went public in 1980.
The world’s largest sportswear company sees revenue declining in the mid-single digits in the company’s current fiscal year, while investors had expected an increase. That has stoked concerns about waning demand and heightened competition from upstarts On and Hoka as well as longtime rival Adidas AG. At least seven analysts tracked by Bloomberg downgraded their ratings on Nike stock following the earnings and guidance update.