The following is excerpted from the question-and-answer section of the transcript.
(Questions from industry analysts are provided in full, but answers are omitted - download the transcript to see the full question-and-answer session)
Question: Bob Drbul - Guggenheim Securities, LLC - Analyst
: Hey, Matt. Good afternoon.
Question: Bob Drbul - Guggenheim Securities, LLC - Analyst
: I was just wondering if on the inventory situation, I think you talked about specifically China being elevated. Can you sort of break down some
more regional, your perspective on where we are with inventories regionally with some of the -- I don't know if I'd use the word dislocation with
some of the classics, North America specifically?
Question: Alex Straton - Morgan Stanley & Co. LLC - Analyst
: Perfect. Thanks a lot. Matt, I just wanted to drill down on this kind of unit disappointment in the quarter. Have you guys identified what exactly like
the biggest challenges or, I guess, problem areas are that you didn't expect a few months ago?
And then just zooming out, as you look forward, have you guys identified the key metrics that you're monitoring just to gauge comeback progress
throughout the year?
Question: Michael Binetti - Evercore ISI Institutional Equities - Analyst
: Hey, guys, thanks for all the help here. Matt, I guess just one thing in the near term. You said that the spring order books actualized a little lower
than you were expecting. But you did mention some elements of the second-half revenue outlook that are maybe a few bright spots versus what
you thought 90 days ago. Could you just help me reconcile those two comments, I guess?
And then thinking a little bit more long term, I think the plan previously was sort of direct-to-consumer to rise in mix and pull the margins of the
company up as the margins in the DTC segment rise above wholesale after some pretty heavy investing you guys did to stage the DTC business
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for scale. Are those investments in place and do they become leverageable over time? Or are there elements of the -- in the DTC business that need
to keep growing as you do look ahead to getting back to growth of that business?
Question: Simeon Siegel - BMO Capital Markets - Analyst
: Thanks. Hey, good afternoon, guys. Matt, thank you for all this. Any color you'd be willing to provide or just order of magnitude on how large each
of the core franchises that you are resetting are at this point and just maybe where you'd like to take them?
And then just revenues were down double digits, but the gross margin still grew nicely this quarter. So, any context on the margins of those
franchises that are being reset versus the rest of the product? Thank you.
Question: Lorraine Hutchinson - BofA Global Research - Analyst
: Thank you. Good afternoon. How would you characterize the receptivity of your wholesale partners to get behind some of the new launches? And
how are your partners feeling about the level of inventory in the wholesale channel now and for the spring season?
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Question: Paul Lejuez - Citi - Analyst
: Hey, thanks, guys. You mentioned Running up double digits in North America, and your Running specialty partners. Can you talk about how far
that business has fallen from peak to trough? How much do you think you have to regain in that channel within North America?
And also, the second quarter gross margin decline that you mentioned, can you just dimensionalize that by region, where your bigger pressure
points are? Is it across the board? Where are the larger declines versus smaller declines? Thanks.
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OCTOBER 01, 2024 / 9:00PM, NKE.N - Q1 2025 Nike Inc Earnings Call
Question: Brooke Roach - Goldman Sachs & Company, Inc - Analyst
: Good afternoon, and thank you for taking our question. I was hoping we could dig in a little bit more on the China business, and what you're seeing
between the read on the macro and what's specific to NIKE? How should we be thinking about your inventory levels by channel in China? And
what types of engagement are you seeing on some of your franchise product versus your new innovation with the Chinese consumer today? Thank
you.
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