Nike chief govt John Donahoe gave an impassioned defence of his firm’s enterprise in China, months after the world’s largest sportswear model grew to become ensnared in a shopper backlash over its previous statements on Xinjiang.
“Nike is a model that’s of China and for China,” Donahoe mentioned on Thursday in response to a query from an analyst relating to the competitors Nike confronted from different manufacturers within the area.
In March, Chinese language state media circulated a months-old assertion from Nike that expressed concern over stories of pressured labour in Xinjiang. Greater than 1m Uyghurs are known to have been detained within the western area, which produces greater than four-fifths of China’s cotton.
The re-emergence of Nike’s assertion sparked criticism from celebrities, together with pop star and then-Nike model ambassador Wang Yibo, who mentioned he would lower ties with the sportswear maker. A statement on Nike’s web site says it doesn’t supply any merchandise or provides from the area.
Shares of Chinese language athletic manufacturers that compete with Nike within the area, together with Li Ning and Anta Sports activities, rose initially in early April amid the backlash towards western manufacturers, which included Swedish fast-fashion chain H&M.
In monetary outcomes launched on Thursday, Nike reported gross sales in better China of $1.9bn for the three months ended Might 31, up 17 per cent from the identical interval in 2020.
For the corporate as a complete, revenues doubled to $12.3bn for the quarter, serving to it swing to a $1.5bn revenue, up from a $709m loss a 12 months earlier on the nadir of the pandemic. Nike’s shares rose 14 per cent in after-hours buying and selling in New York.
Donahoe attributed the corporate’s success in China partly to its decades-long funding. “Now we have been in China for over 40 years,” he mentioned, a connection established by Phil Knight, Nike co-founder and former chief govt.
Donahoe, who took the helm in January 2020, spent the early days of his tenure visiting Nike’s operations in China. He mentioned the corporate’s “greatest asset is shopper fairness [in the brand] . . . it’s actual, I noticed it in my first week on the job”.