Nike reports $790mn loss as sales plunge on COVID-19 hit

NEW YORK, NY - DECEMBER 20: A Nike logo is seen at the Nike flagship store on 5th Ave. on December 20, 2019 in New York City.

AFP

NEW YORK - Sports giant Nike reported a surprise loss as shutdowns due to COVID-19 prompted a big drop in revenues in spite of higher online sales.

Nike reported a loss of $790-million in the quarter ending May 31, which translated to a loss of 51 cents per share compared with analyst expectations for nine cents per share in profit.

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Revenues tumbled 38 percent to $6.3-billion following huge declines in sales in most of the world.

In North America, the company's biggest operating region, revenues plunged 46 percent to $2.2-billion.

Nike said 90 percent of its stores were closed for roughly eight weeks during the quarter in three of its four operating regions, with the exception being Greater China. A bright spot was online sales, with digital sales increasing 75 percent during the quarter.

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The results are among the first by a major company to detail the hit from the coronavirus during the period of peak shutdowns. Nike is on a different fiscal calendar than most other large companies, with its fourth-quarter ending May 31.

The second-quarter earnings period, which covers the quarter ending June 30, will begin in mid-July.

Source
AFP