Nike, which ranks first in the world’s sports equipment industry, has also been hit by a new coronavirus infection (COVID-19). Nike shares plunged in after-hours trading after it released disappointing earning reports.
According to CNBC on the 25th, Nike announced in its report on fiscal fourth quarter 2019 that its sales worth 6.31 billion dollars. It is down 38% from the same period last year. Consequently, net profit hit minus $790 million, with a loss of 51 cents per share. The figure is a turnaround from a net profit of $989 million during the same period a year ago.
Nike shares down due to COVID-19, offline sales took the biggest damage
In particular, damages are more severe on the offline sales. This is because stores and department stores around the world have been shut down, outdoor activities have been reduced, and demand for sporting goods has been reduced due to the Corona 19 Pandemics.
Among them, sales in North America plunged 46 percent. By item, shoes and clothing fell 35 percent and 42 percent, while equipment sales fell 53 percent. CNBC said, “Even Nike, one of the most powerful global brands in the retail industry, has been hit by the Corona 19 Pandemics.”
On the other hand, online sales surged as people spent more time at home due to global blockades. Online sales increased by 75% in the fourth quarter, and its share of total sales increased by 30%. Nike previously aimed to increase its online share by 30 percent by 2023.
Meanwhile, Nike shares fell nearly 4 percent in off-hours trading in New York on Tuesday, as the company’s earnings fell short of expectations.
On the other hand, as the pandemic surges, anti-China movement has started to resurface. Boycott China has been a trend in India and the U.K., starting to ban the Made in China products to their countries.
Nike itself holds a huge market in China, despite the slight fall last year due to the US-China trade war sentiment.
