Nike Reports Surprise $790 Million Loss, 46% Plunge in North American Sales

Disclaimer. I’ve been a Nike product tester since the early 1990’s.

Editorial up top and business reporting below

In 2008 the Oregon Ducks dropped their wrestling program. Oregon’s athletic programs are heavily subsidized by Nike. While Oregon wasn’t a power house it had two All-Americans in 2006, Joey Bracamonte and National Champion, Shane Webster. Since 1961 the state of Oregon produced almost 150 All Americans which is a great recruiting base. Good enough to be the 11th best state at producing college talent. When Athletic Director Pat Kilkenny sited reasons for dropping the 50-year-old Oregon University wrestling program he cited facilities challenges as the primary reason.

Nike owner Phil Knight, could have easily afforded to subsidize the wrestling program. The higher ups at Oregon and Nike wanted a baseball team instead of wrestling. Oregon State had a powerhouse baseball team at the time and it was a bad look for Oregon to not have a team, let alone a good team.

If changing programs was about saving money they wouldn’t have cut the relatively cost-efficient wrestling team in favor of a money-pit that is D1 baseball. In more recent times we just have to look at the Boise State budget to see how much more baseball budgets are than wrestling. Like Boise State, Oregon decided to cut a good wrestling program and replace it with a mediocre baseball program.

The mockery is, Nike still makes money off wrestling supplies. Why does anyone that knows this history purchase Nike wrestling gear.

Buying Nike wrestling products is like paying for your ex-wife’s birth control.

New York (AFP) – Sports giant Nike reported a surprise loss Thursday as shutdowns due to COVID-19 prompted a big drop in revenues in spite of higher online sales.

Nike reported a loss of $790 million in the quarter ending May 31, which translated to a loss of 51 cents per share compared with analyst expectations for nine cents per share in profit.

Revenues tumbled 38 percent to $6.3 billion following huge declines in sales in most of the world.

In North America, the company’s biggest operating region, revenues plunged 46 percent to $2.2 billion.

A bright spot was online sales, with digital sales increasing 75 percent during the quarter.

The results are among the first by a major company to detail the hit from the coronavirus during the period of peak shutdowns. Nike is on a different fiscal calendar than most other large companies, with its fourth quarter ending May 31.

The second-quarter earnings period, which covers the quarter ending June 30, will begin in mid-July.

Shares of Nike fell 3.7 percent ot $97.61.

2 Comments

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  1. Nike’s North American reseller, APS, has been pumping money into wrestling for the last several years. If Oregon doesn’t want wrestling, we can’t shove it down their throats. There’s been a big effort from wrestling people to bring Nike back. They aren’t just making money off a stock shoe anymore, they are visible and active within the sport.

    Nike Wrestling isn’t exactly Uncle Phil’s Oregon. WrestleAPS shouldn’t be hit because Nike U doesn’t want to fund it. Wrestling has Nike athletes.

    I loathed the brand until I saw some people actually making an effort to turn things around. Grant Turner told me years ago “just wait.”

    They had a hand in bringing back Fresno State and again, if Oregon doesn’t want wrestling, that’s their loss. I haven’t forgotten, but I’ve seen what happens when wrestling people actually push the brand. These numbers don’t indicate anything about wrestling.

  2. Thanks Jason for your thoughts and the update.

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