As Foot Locker Reports A Slide In Holiday Quarter Profits, It Boasts A "Renewed" Relationship With Nike

A "renewed" and revitalized relationship between Foot Locker and Nike was highlighted by Foot Locker CEO Mary Dillon on Monday.

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There was a 4% rise in Foot Locker shares. Monday morning, sneaker and athletic apparel retailer DSW reported quarterly earnings. 

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Just under $2.34 billion in sales was posted by Foot Locker during the holiday quarter, which ended Jan. 28. A year earlier, it earned $103 million, or $1.02 per share, compared with $19 million, or 20 cents per share. Earnings per share, excluding items, decreased to 97 cents from $1.46.

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Foot Locker expects adjusted earnings per share of $3.35 to $3.65 for the current fiscal year, which includes an extra week.

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Following Nike's move away from wholesale channels to focus on direct-to-consumer sales, Dillon has spent a lot of time revitalizing Foot Locker's partnership with Nike since she became the company's CEO in September. 

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"Nike is our largest brand partner and the industry leader. From day one, John Donahoe and Heidi O'Neill with their teams welcomed me to the industry," Dillon said of Nike's CEO John Donahoe, and its president of consumers and marketplaces Heidi O'Neill.

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Former Ulta chief executive John Dillon said Foot Locker and Nike were re-establishing joint planning and data sharing. 

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"This year, as we build momentum toward 2024 and Foot Locker's 50th anniversary, we'll see the results of our renewed commitment to one another," Dillon said. 

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Through its direct-to-consumer strategy, Nike has reduced its wholesale partnerships over the years, which has led to the development of its e-commerce channels and new store locations. 

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However, Nike also relied on wholesale partners to move its inventory out during the last few quarters due to pandemic-related supply chain challenges. 

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Following several quarters of virtually flat wholesale revenue, the company recorded 19% growth during its fiscal-second quarter ending Nov. 30. 

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Donahoe spoke about the importance of an omnichannel model in a January interview with Trade Algo regarding Nike's direct-to-consumer plans.

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“The wholesale partners we work with, such as Dick's Sporting Goods, are strategic,”

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 Donahoe says retailers such as Foot Locker or JD are vital for consumers because they want to try on products and feel them. "Our strategic relationships have been strengthened as a result."