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Nike on Thursday forecast a surprise drop in fiscal 2025 sales, after disappointing fourth-quarter sales laid bare the company’s weakening market share and its faltering direct-to-consumer strategy.

Shares of the company were down 12% in extended trading after Nike also forecast a wider-than-expected drop in first-quarter revenue.

The company’s efforts to drive more sales through its direct-to-consumer channel have failed to reap rewards as customers turn more picky about non-essential spending and splurge on fashionable and innovative brands such as On and Deckers’ Hoka.

Nike expects annual revenue to be down in the mid-single digits compared with estimates of a rise of 0.91%.

“The slowdown in total sales and for Nike Direct is hard to ignore. We continue to rack our brain for where Nike can get its next leg of growth,” said Zachary Warring, equity analyst at CFRA Research.

Nike is also losing ground to rival Adidas‘ retro-style Gazelle and Samba sneakers, which have helped the European sportswear maker see a rebound in demand after its damaging break-up with rapper Ye.

Even though Nike has outlined a plan to streamline its portfolio, analysts note that it would be some time before the sportswear company can revive demand as innovation and launches of new product lines take time.

The Air Jordan maker’s strategy to double down on wholesale partnerships helped wholesale revenue in the reported quarter rise 5%, while growth in its direct-to-consumer business fell 8%.

Nike’s net revenue fell 1.71% to $12.61 billion, compared with analysts’ average estimate of $12.84 billion, according to LSEG data.

However, the company’s $2 billion cost savings plan including layoffs, helped the company adjusted earnings of $1.01 top estimates of 83 cents.

Nike is also struggling with weak demand in international markets, including China, where brick and mortar traffic declined in double digits versus prior year, executives said.

Headwinds including weakness in its digital business, soft store traffic and higher promotions are expected to have a “more pronounced impact” in fiscal 2025, CFO Matthew Friend added.

Nike expects first-quarter revenue to fall about 10% compared with expectations of a 3.16% fall.

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Sovereignty outduels Journalism to capture Derby

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Sovereignty outduels Journalism to capture Derby

LOUISVILLE, Ky. — Sovereignty outdueled 3-1 favorite Journalism down the stretch to win the 151st Kentucky Derby in the slop on Saturday.

Trainer Bill Mott won his first Derby in 2019, also run on a sloppy track, when Country House was elevated to first after Maximum Security crossed the finish line first and was disqualified after a 22-minute delay.

This time, he knew right away.

Sovereignty won by 1½ lengths and snapped an 0-for-13 Derby skid for owner Godolphin, the racing stable of Dubai ruler Sheikh Mohammed bin Rashid Al Maktoum.

It was quite a weekend for the sheikh. His filly, Good Cheer, won the Kentucky Oaks on Friday and earlier Saturday, Ruling Court won the 2,000 Guineas in Britain.

Sovereignty covered 1¼ miles in 2:02.31 and paid $17.96 to win at 7-1 odds.

Journalism found trouble in the first turn and jockey Umberto Rispoli moved him to the outside. He and Sovereignty hooked up at the eighth pole before Sovereignty and jockey Junior Alvarado pulled away.

Baeza was third, Final Gambit was fourth and Owen Almighty finished fifth.

Rain made for a soggy day, with the Churchill Downs dirt strip listed as sloppy and horse racing fans protecting their fancy hats and clothing with clear plastic ponchos.

The Associated Press contributed to this report.

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Zilisch to miss Xfinity race in Texas after wreck

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Zilisch to miss Xfinity race in Texas after wreck

FORT WORTH, Texas — Connor Zilisch, the 18-year-old driver already with two NASCAR Xfinity Series race wins, will miss Saturday’s race at Texas because of lower back injuries sustained in a last-lap wreck at Talladega.

Trackhouse Racing said Wednesday that its development driver will return as soon as possible to the No. 88 JR Motorsports Chevrolet. The team didn’t provide any additional details about Zilisch’s injuries.

Cup Series regular Kyle Larson will drive the No. 88 in Texas. After that, the Xfinity Series has a two-week break before racing again May 24 at Charlotte.

Zilisch, sixth in points through the first 11 races, was driving for the win at Talladega Superspeedway when contact on the backstretch sent his car spinning, and head-on into inside wall.

Zilisch won in his Xfinity debut at Watkins Glen last Sept. 14. He added another win this year at Austin, the same weekend that he made his Cup Series debut. He has six top-10 finishes in his 15 Xfinity races.

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23XI, Front Row ask judge to toss NASCAR claim

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23XI, Front Row ask judge to toss NASCAR claim

CHARLOTTE, N.C. — The two teams suing NASCAR asked a judge to dismiss the sanctioning body’s counterclaim in court Wednesday.

In a 20-page filing in district court in North Carolina, 23XI Racing and Front Row Motorsports opposed NASCAR’s motion to amend its original counterclaim. The teams argued that the need to amend the counterclaim further demonstrates the weakness of NASCAR’s arguments, calling them an attempt by NASCAR to distract and shift attention away from its own unlawful, monopolistic actions.

NASCAR’s counterclaim singled out Michael Jordan’s longtime business manager, Curtis Polk. Jordan is co-owner of 23XI Racing.

The legal battle began after more than two years of negotiations on new charter agreements — NASCAR’s equivalent of a franchise model — and the 30-page filing contends that Polk “willfully” violated antitrust laws by orchestrating anticompetitive collective conduct in connection with the most recent charter agreements.

23XI and Front Row were the only two organizations out of 15 that refused to sign the new agreements, which were presented to the teams last September in a take-it-or-leave-it offer a mere 48 hours before the start of NASCAR’s playoffs.

The charters were fought for by the teams ahead of the 2016 season and twice have been extended. The latest extension is for seven years to match the current media rights deal and guarantee 36 of the 40 spots in each week’s field to the teams that hold the charters, as well as other financial incentives. 23XI and Front Row refused to sign and sued, alleging NASCAR and the France family that owns the stock car series are a monopoly.

NASCAR already has lost one round in court in which the two teams have been recognized as chartered organizations for the 2025 season as the legal dispute winds through the courts. NASCAR has also appealed a judge’s rejection of its motion to dismiss the case.

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