Find new growth points! Nike (NKE.US) increased investment in the outdoor sports business in the Chinese market and became a priority

The Zhitong Finance App learned that after a difficult year, Nike (NKE.US) is looking for new growth points and is preparing to promote its outdoor business All Conditions Gear (ACG) on a global scale. “We are now investing more resources into this incredible growth opportunity,” Nike President Heidi O'Neill and Craig Williams said in a memo. They added that they will continue to drive new ACG investments across the organization's global, geographic and city teams in the coming months.

Nike's ACG business produces hiking gear such as waterproof boots, ripstop jackets, and daypacks. Detailed plans for the business are yet to be finalized. Nike executives said ACG's strategy, organizational design, and operating model still need to be improved.

Additionally, as part of the new initiative, Angela Dong (Angela Dong) will be promoted to the position of Chairman and CEO of Nike Greater China and the global CEO of the ACG brand. Nike said that China will be the direct focus of ACG's business. As the global CEO of the ACG brand, Dong Wei will lead the products, brands and sales of the global ACG business to accelerate the development of the ACG brand in the global and Chinese markets.

Against the backdrop of global economic uncertainty and slowing consumer spending, Nike's performance is facing a continued decline. Nike announced in September that former executive Elliott Hill would rejoin the company to succeed John Donahoe as president and CEO. Hill spent 32 years at Nike, holding senior leadership positions in Europe and North America, helping the company grow its business to more than $39 billion. Prior to his retirement in 2020, Hill was president of Nike Consumer Markets, leading all commercial and marketing operations of the Nike brand.

According to the latest financial report, Nike's revenue for the first quarter of fiscal year 2025 was 11.6 billion US dollars, down 10.4% year on year, falling short of market expectations; net profit was US$1,051 million, down 28% year on year; and diluted earnings per share were 0.70 US dollars, exceeding market expectations of 0.52 US dollars. Nike also withdrew its full-year performance forecast. In response, Matt Friend, the company's chief financial officer, said that the withdrawal of the guidelines was due to an upcoming leadership transition.

Nike wants to provide new growth opportunities through the booming development of the outdoor sporting goods market, especially the huge potential of the Chinese market. What cannot be overlooked, however, is that the boom in outdoor racetracks has sparked competition among many clothing brands. In addition to well-known outdoor brands such as Patagonia, North Face, and Archaeopteryx, Nike's old rival Adidas is also laying out outdoor products. It seemed like quite a challenge for ACG to stand out from it.