That first means aggressively clearing out old inventory – usually at discounts – which is weighing on revenue at a time when steep tariffs are pressuring margins. Last quarter, Nike raised its expected tariff costs this year to $1.5 billion, citing exposure to high-tariff countries such as Vietnam. The company, set to report second-quarter earnings on Thursday, had nearly 60 marketing and communications jobs open on its website as of Tuesday and held a rare job fair for communications professionals in New York this week. Finance chief Matthew Friend in September forecast “an acceleration of demand creation investment” – corporate speak for marketing spend. That spend is expected to top US$5 billion in 2026, according to LSEG data, up from US$4.68 billion in fiscal 2025. The added focus on marketing is “a bullish sign that they feel better about the product,” but also that “they acknowledge they need to make the appropriate investment behind it,” said Mari Shor, senior equities analyst at Columbia Threadneedle, which holds Nike stock. Nike is expected to report that net profit fell for the sixth straight quarter in the three months ended November 30, more than halving to US$562.35 million, according to LSEG data. Second-quarter revenue likely fell again – down 1.09 per cent to US$12.22 billion – after a small uptick in the first quarter. Gross margin likely slipped to 40.77 per cent from 42.2 per cent in the first quarter. Marketing and innovation in focus In recent years, Nike has lacked new, innovative products to highlight, leading its ads to focus more on the storied brand than individual products, said Morningstar analyst David Swartz. As the company starts to innovate on new products, its advertising could evolve, he said. But Swartz added: “No one is expecting a great quarter.” Competition in China, which accounts for 15 per cent of sales, has been stiff from domestic brands Anta and Li-Ning. Retail in China operates mostly through monobrand stores, limiting a company’s ability to sell through diverse channels as Nike does in the United States. Nike has invested heavily in new versions of its running shoe lines, Pegasus Premium and Vomero 18, as the running category has performed well, while scaling back production of sneakers such as the Air Force 1. With new products boosting performance – and the sports marketing bonanza that is the World Cup six months away – Nike faces a golden chance to reaffirm its cultural cachet. It has also forged partnerships with Kim Kardashian’s activewear and essentials brand SKIMS, while promoting sustainability initiatives, such as the use of recycled materials, to align with evolving consumer demands for ethical shopping. Further reading: Nearly a year on, has Elliott Hill put Nike back on track?