NIKE, Inc. (NIKE) recently reported Q4 losses as they were forced to close global store closures due to the coronavirus pandemic and shutdown. Revenue of $6.31B was reported versus $7.38B expected and loss per share of $.51, versus earnings of 10 cents per share expected. About 90% of Nike’s physical stores in North America, Europe, the Middle East, Africa, and the Asia Pacific region were closed for about eight weeks during the quarter. The company’s gross margin reduced 820 basis points, to 37.2%, in the Q4 driven by factory cancellation charges, rising inventory reserves, and supply chain costs. On a positive note, Nike’s digital sales surged 75% in Q4, contributing to 30% of overall revenue.
The company disclosed in May that closures would generate “significantly lower wholesale revenue and higher inventory” during the fourth quarter. Recently, 90% of company-owned stores were open as of Thursday with 100% store operations in China. “As physical retail re-opens, NIKE’s strong digital trends continue, a testament to the strength of our brand and the investments we’ve made to elevate digital consumer experiences,” stated Nike Chief Financial Officer Matt Friend.
NIKE, Inc. (NIKE) is the world’s top designer, marketer, and distributor of athletic footwear, equipment, apparel, and accessories. The Beaverton, Oregon based company offers products for a wide variety of sports and fitness activities. To learn more about NIKE, Inc. (NIKE) and to continue to track its progress please visit the Vista Partners NIKE Coverage Page.