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Nike optimizing supply and demand daily to weather coronavirus storm

March 25, 2020 / Emma Cosgrove
SHARESHARESHARE

Shifting to a digital-first distribution strategy, "daily global demand and supply optimization" and tight cost management are major tenets of what Nike executives called their "coronavirus playbook" on a Tuesday earnings call. "Our measures of success in the near-term will be rooted in the amount of inventory on hand relative to the pace of digital demand, store re-openings and traffic patterns," CFO Andy Campion said. Nike saw gross margin decline 80 basis points to 44.3%, with a 5% bump in revenue, in the quarter ending Feb. 29, and Campion said there would be more margin erosion ahead. But Nike's operational prowess and liquidity will allow the company to snap back whenever consumer demand returns while keeping and paying employees, newly installed CEO John Donahoe said on the call.