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Nike CEO John Donahoe passionately defended his company’s business in China, months after the world’s largest sportswear brand was caught in a consumer reaction by his past statements in Xinjiang.
“Nike is a brand of China and China,” Donahoe said Thursday in response to a question from an analyst about the competition Nike had over other brands in the region.
In March, Chinese state media circulated a statement from Nike months ago expressing concern over reports of forced labor in Xinjiang. There are more than 1m Uyghurs known to have been arrested in the western region, which produces more than four-fifths of China’s cotton.
The reappearance of the Nike statement sparked criticism from celebrities, including pop star and then-brand Nike ambassador Wang Yibo, who said he would sever ties with the sportswear maker. A statement on the Nike website it says no products or supplies come from the region.
Shares of Chinese athletic brands competing with Nike in the region, including Li Ning and Anta Sports, pink initially in early April amid the backlash against Western brands, which included Swedish fast fashion chain H&M.
In the financial results released on Thursday, Nike recorded sales in China in excess of $ 1.9 billion during the three months ended May 31, 17% more than the same period in 2020.
For the company as a whole, revenue doubled to $ 12.3 billion during the quarter, which helped it grow to $ 1.5 billion, Loss of $ 709 million a year before the nadir of the pandemic. Shares of Nike rose 14% in after-hours operations in New York.
Donahoe attributed the company’s success to China in part to its decades-long investment. “We’ve been in China for over 40 years,” he said, a connection established by Phil Knight, co-founder of Nike and former CEO.
Donahoe, who took the helm in January 2020, spent the first few days of his tenure visiting Nike’s operations in China. He said “the company’s main asset is consumer equity[in the brand]. . . it’s real, I saw it in the first week of work ”.
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