What's going on?

�Twas the week before Christmas, when all through the house, a sportswear giant was reporting… better-than-expected quarterly earnings. And investors heard it exclaim, ere it drove out of sight: �Merry Christmas to all, and to all a good Nike!�

What does this mean?

Last quarter, Nike�s (yes, we know) total revenue was up 10% and its profit up 35% from the same time last year. That was partly thanks to limited edition Air Jordan sneakers which propelled the brand to over $1 billion worth of sales for the first time.


But in North America, where Nike makes 40% of its revenue, its growth actually fell short of expectations. Tariff-influenced higher product prices could�ve been to blame, but investors might also be worried about competition from the likes of Adidas. That could explain its stock�s slight fall late last week, even though Nike now expects its annual revenue growth to be higher than forecast.

Why should I care?

For markets: A thirteen-year run ends.

Nike�s recently courted controversy with divisive ads and the reveal of women’s mistreatment at its now-shuttered training center. But you wouldn�t know it: the company’s stock has risen some 700% versus the US stock market�s 125% in the thirteen years under its outgoing CEO (tweet this). Nike�s investors will hope the incoming CEO can bring about another big upswoosh in value. And there�s no reason he won�t be able to just do it: his background leading eBay should certainly help Nike�s already-impressive ecommerce business, which grew 38% last quarter.

The bigger picture: Ready� set� sell!

This decade was dominated by China�s rise as a global superpower. So Nike�s next decade will likely rely on convincing the country�s increasingly well-to-do consumers to spend more on sports and athleisure products. It�s already made headway: Nike’s Chinese sales last quarter were over 20% higher than the same time last year, despite the twin disruptions of civil unrest in Hong Kong and an ongoing � though now simmering � trade war.