Covid-19: Nike posts big loss for three months
Sports footwear and apparel giant Nike swung heavily into loss in its March-to-May 2020 quarter, reflecting the impact of COVID-19.
The Oregon-based company said its fourth quarter results were “significantly impacted by physical store closures” across the globe.
It said product shipments to wholesale customers were down “nearly 50 per cent”, resulting in lower total revenue and higher inventory.
However, in line with an upsurge of ecommerce generally, Nike’s digital business was said to be accelerating “in every market.”
All told, the net loss for the three months to May 31 reached $790 million (£642 million/€702 million), compared with net income of $989 million (£804 million/€879 million) a year earlier.
Revenues plunged by 38 per cent from $10.18 billion (£8.28 billion/€9 billion) to $6.31 billion (£5.1 billion/€5.61 billion).
Meanwhile, in a development that may be of direct concern to sport, Nike said that what it refers to as “demand creation expense” dipped 19 per cent to $823 million (£669 million/€732 million), “as retail and brand marketing spend was shifted as sporting events were cancelled or delayed due to COVID-19.