JD Sports’ US Sales Show How Much Nike’s Comeback Has to Prove

JD Sports says Nike’s newer running shoes are resonating, yet its North American sales are falling. Investors need to see product momentum turn into stronger sales.

Nike’s newer running shoes are gaining traction with shoppers, according to one of its biggest retail customers. But JD Sports’ latest results show how far that product momentum still has to travel.

JD reported a 6.8% fall in North American comparable sales in its second quarter. Its first-half profit before tax and adjusting items fell about 20% to £282 million. North America accounts for 38% of JD’s group sales, making weakness there difficult to offset elsewhere.

The test for Nike

Nike represents more than 40% of JD’s sales, according to Reuters. JD’s finance chief says newer performance ranges, including Vomero and Pegasus, are connecting with customers. He expects Nike’s recovery to take time.

That is encouraging for Nike investors, but it is too early to call a turnaround. JD says its customers face cost pressures, while the footwear market remains highly promotional. Stronger products will need to translate into sustained sales without relying heavily on discounts.

JD has kept its full-year profit forecast at £700 million to £800 million, following a cut last month. Its next sales updates should give investors a clearer view of whether demand for Nike’s new products is becoming large enough to shift the numbers.