Nike (NKE) swung to a quarterly loss and posted fiscal fourth-quarter sales that dropped more than expected as a slew of global store closures hit the athletic-wear maker’s results. Shares of Nike dropped more than 2% in extended trading after reporting results.
Here were the main metrics from the report, compared to consensus estimates compiled by Bloomberg:
Revenue: $6.31 billion, vs. $7.38 billion expected and $10.2 billion Y/Y
Loss per share: 51 cents, vs. earnings of 10 cents per share expected and earnings of 62 cents Y/Y
Nike’s results captured the three-month period between March and the end of May, during which the athletic-wear giant contended with a slew of store closures across the globe. The vast majority of Nike-owned stores outside of China and South Korea were shut in mid-March due to the pandemic, and just 5% of North American retail locations had reopened as of mid-May, with many open only for reduced hours.
Nike warned in a mid-May update that store closures would generate “significantly lower wholesale revenue and higher inventory” during the fourth quarter, and drive a “material impact” on results in North America, Europe, the Middle East, Africa and Asia.
Still, the previous quarter through the end of February saw Nike’s sales hold up more strongly than expected, even given closures that at the time had swept China. The company managed to offset retail store closures in China with a more than 30% surge in digital sales.
That dynamic was expected to continue through May.
“We are seeing accelerated new member acquisition and strong digital demand across the global marketplace, with increased traffic and engagement on our mobile commerce and activity apps,” Nike said in a mid-May update. “We have increased our digital fulfillment capacity to meet this higher than anticipated demand which is partially offsetting declines in NIKE-owned stores.”
Shares of Nike have fallen less than half a percent for the year to date, versus a decline of 4.8% in the S&P 500.
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Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter: @emily_mcck
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