June 26 (Reuters) - Nike ( NKE ) reported a

smaller-than-expected drop in fourth-quarter revenue and beat

profit estimates on Thursday, as CEO Elliott Hill's strategy to

focus product innovation and marketing around sports begins to

pay off.

The company, which has been grappling with competition in

the running space, has heavily invested in running shoes and

sneaker lines such as Pegasus and Vomero, and tried to cut its

stock of older models such as the Air Force 1 and Air Jordan 1,

through discounts.

Under Hill, who joined in October last year, Nike ( NKE ) has

rekindled relationships with wholesale partners, expanding the

company's presence at more physical retailers, and started

selling on Amazon.com ( AMZN ) for the first time in six years.

The company's fourth-quarter revenue fell 12% to $11.10

billion, compared with analysts' expectation of a 14.9% drop to

$10.72 billion, according to data compiled by LSEG.

Under Hill's "win now" strategy, Nike ( NKE ) is also investing more

into sport-focused marketing to regain its edge as a sports

brand.

The company on Thursday hosted an attempt by sponsored

athlete Faith Kipyegon to run a mile in under four minutes.

Paced by other star athletes in the glitzy, live-streamed event

in a Paris stadium, Kipyegon fell short of the goal but set a

new unofficial record.

Nike ( NKE ) reported fourth-quarter earnings per share of 14 cents,

compared with analysts' average estimate of 12 cents.

China continues to be a pain point in the reported quarter,

the company said, as tougher economic conditions and competition

hurt demand for Nike's ( NKE ) sneakers in the country.

Sales in China fell 21% in the fourth quarter, following a

17% fall in the prior three-month period.

Its gross margin for the quarter ended May 31 fell 440 basis

points following a 330 basis points drop in the third quarter.

Nike's ( NKE ) shares were down 2% in extended trading. They have

fallen 19.6% so far this year.

(Reporting by Juveria Tabassum in Bengaluru and Helen Reid;

Editing by Shinjini Ganguli)