Nike's quarterly revenue increased 8% but the sales increase for the quarter wasn't as strong as analysts had expected.
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By Phil Wahba
October 27, 2014

Nike (NKE) just can’t shake scrutiny of its relationship with the National Football League.

As the athletic gear maker pushes its fast-growing women’s business, recent cases of domestic violence involving players in the league are creating a problem for the Nike name.

On Monday, the president of Nike Brand, Trevor Edwards, said in response to a question from the audience at a conference that Nike has been speaking “very directly” with the NFL about how it handled the domestic violence controversies this past summer.

“We certainly have those conversations with them, and we’re very, very clear about it,” Edwards said at the Women’s Wear Daily CEO retail conference in New York. “We cannot tolerate domestic violence or any of these issues, and they’re serious issues. They’re serious for sports but they’re also serious for society at large.”

Nike, which has been the official provider of NFL jerseys since 2012, dropped its endorsement deal with Ray Rice after the release of a video that show him knocking out his now-wife in an elevator. It has also ended its endorsement of Adrian Peterson, who has been charged with abusing his 4-year-old son with a tree branch.

Nike has expressed its view “very strongly” to the NFL that it had not handled these controversies well, Edwards said. “We speak very directly with them about it.”

The company cannot afford to make a misstep when it comes to marketing to women at a time it is making a big push to get a bigger share of the women’s market. Last week, Nike unveiled a new line of athletic gear for women with hopes that the new line of sports bras, tights and other apparel can add $2 billion to current annual sales of women’s gear, bringing its revenue from that segment to $5 billion by 2017.

Sales growth of women’s gear has outpaced men’s for five years, Edwards said.

“We’re very excited about connecting with [women] in the right way,” he added.

That, of course, hinges on Nike not finding itself on the wrong side of a social issue that is top of mind for millions of its customers.

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