Latest news with #Nike-owned
Yahoo
2 hours ago
- Business
- Yahoo
Nike stock soars 15% as company forecasts smaller sales, profit drops while tariff costs near $1 billion
Nike (NKE) stock soared on Friday after the sneaker giant said its profit and sales declines would narrow in the current quarter, while costs from tariffs are expected to approach $1 billion as the company makes additional moves to diversify its supply chain away from China. Nike said Thursday it expects sales to be down by mid-single digits in the current quarter following a 12% drop in revenue during its fiscal fourth quarter ended May 31. Gross margins fell by 440 basis points, or 4.4%, in its fourth quarter and are forecast to fall by 350-425 basis points in the current quarter. Shares rose 15.2% on Friday, bringing Nike's year-to-date losses to less than 5%; in early April, Nike stock was down 30% in 2025 alone. Read more about Nike's stock moves and today's market action. On its conference call with investors late Thursday, Nike CFO Matthew Friend said newly implemented US tariffs "represent a new and meaningful cost headwind." Nike expects a 100 basis point negative impact on its gross margins as a result of tariffs. Friend added the company sees a "gross incremental cost increase to Nike of approximately $1 billion," adding, "We intend to fully mitigate the impact of these headwinds over time." On Thursday, Nike said it plans to cut its reliance on China for manufacturing the goods it sells in the US as part of this strategy. Chinese suppliers currently account for about 16% of the shoes it imports into the US, and the company said on its earnings call that it expects to bring that down to "high single-digit range" by the end of this fiscal year. The company also announced plans for a "surgical price increase" in the US, which is set to begin this fall. Read more: What Trump's tariffs mean for the economy and your wallet Nike has been challenged by the sweeping tariffs announced by President Trump earlier this year, with those impacts still uncertain given its global operational footprint and exposure both to China and Vietnam. The company has been diversifying its manufacturing base since Trump's first term in office. In 2024, it produced 18% of its apparel and 16% of footwear in China, compared to 26% and 29%, respectively, in 2016. Nike's struggles in China have also continued, with revenue falling 20% in the region last quarter, driven by a footwear and apparel sales decline of 20% and 19%, respectively. For its fiscal fourth quarter, ended May 31, Nike reported revenue of $11.1 billion, a 12% decline that was lower than Wall Street forecasts for a nearly 15% decline to $10.72 billion, according to Bloomberg data. Adjusted earnings per share tallied $0.14, compared to the forecast $0.13 per share. That was far lower than the $1.01 per share in earnings it reported in the same quarter last year. Same-store sales at Nike-owned stores ticked higher, rising 2% compared to the 2.6% decline analysts anticipated. "While our financial results are in line with our expectations, they are not where we want them to be. Moving forward, we expect our business to improve as a result of the progress we're making," CEO Elliott Hill said in the release. Alongside the tariffs headwinds, Nike is also facing deteriorating consumer confidence as it aims to get customers back in stores and competes with rivals like On (ONON) and Hoka (DECK). Nike stock is still down over 6% this year with Friday's surge but has rebounded sharply from its April 8 lows, the day before President Trump paused his most dramatic tariffs announced on "Liberation Day." The company is also banking on certain innovations like the launch of Vomero 18, Jordan Retros, A'One, and a collaboration with Kim Kardashian. Nike is also patching up its wholesale partnerships with the likes of Dick's Sporting Goods (DKS) and Macy's (M) after it decided to focus on its direct-to-consumer business. Brooke DiPalma is a senior reporter for Yahoo Finance. Follow her on X at @BrookeDiPalma or email her at bdipalma@ Click here for all of the latest retail stock news and events to better inform your investing strategy
Yahoo
9 hours ago
- Business
- Yahoo
Nike stock surges as company forecasts smaller sales, profit drops while tariff costs near $1 billion
Nike (NKE) stock soared early Friday after the sneaker giant said its profit and sales declines would narrow in the current quarter, while the costs from tariffs are expected to approach $1 billion as the company makes additional moves to diversify its supply chain away from China. Nike said Thursday it expects sales to be down by mid-single digits in the current quarter following a 12% drop in revenue during its fiscal fourth quarter ended May 31. Gross margins, which fell by 440 basis points, or 4.4%, in its fourth quarter, are forecast to fall by 350-425 basis points in the current quarter. Shares rose as much as 13% shortly after the opening bell on Friday. Read more about Nike's stock moves and today's market action. On its conference call with investors late Thursday, Nike CFO Matthew Friend said newly implemented US tariffs "represent a new and meaningful cost headwind." Nike expects a 100 basis point negative impact on its gross margins as a result of tariffs. Friend added the company sees a "gross incremental cost increase to Nike of approximately $1 billion," adding, "We intend to fully mitigate the impact of these headwinds over time." On Thursday, Nike said it plans to cut its reliance on China for manufacturing the goods it sells in the US, as part of this strategy. Chinese suppliers currently account for about 16% of the shoes it imports into the US, and the company said on its earnings call it expects to bring that down to "high-single digit range" by the end of this fiscal year. The company also announced plans for a "surgical price increase" in the US, which is set to begin thi fall. Nike has been challenged by the sweeping tariffs announced by President Trump earlier this year, with those impacts still uncertain given its global operational footprint and exposure both to China and Vietnam. The company has been diversifying its manufacturing base since Trump's first term in office. In 2024, it produced 18% of its apparel and 16% of footwear in China, compared to 26% and 29%, respectively, in 2016. Nike's struggles in the China have also continued, with revenue falling 20% in the region last quarter, driven by a footwear and apparel sales also decline of 20% and 19%, respectively. For its fiscal fourth quarter, ended May 31, Nike reported revenue of $11.1 billion, a 12% decline that was lower than Wall Street forecasts for a nearly 15% decline to $10.72 billion, according to Bloomberg data. Adjusted earnings per share tallied $0.14, compared to the forecast $0.13 per share. That was far lower than the $1.01 per share in earnings it reported in the same quarter last year. Same-store sales at Nike-owned stores ticked higher, rising 2% compared to the 2.6% decline analysts anticipated. "While our financial results are in line with our expectations, they are not where we want them to be. Moving forward, we expect our business to improve as a result of the progress we're making," CEO Elliott Hill said in the release. Alongside the tariffs headwinds, Nike is also facing deteriorating consumer confidence as it aims to get customers back in stores and competes with rivals like On (ONON) and Hoka (DECK). Read more: What Trump's tariffs mean for the economy and your wallet Nike stock is still down over 6% this year with Friday's surge, but has rebounded sharply from its April 8 lows, the day before President Trump paused his most dramatic tariffs announced on "Liberation Day." The company is also banking on certain innovations like the launch of Vomero 18, Jordan Retros, A'One, and a collaboration with Kim Kardashian. Nike is also patching up its wholesale partnerships with the likes of Dick's Sporting Goods (DKS) and Macy's (M) after it decided to focus on its direct-to-consumer business. Brooke DiPalma is a senior reporter for Yahoo Finance. Follow her on X at @BrookeDiPalma or email her at bdipalma@ Click here for all of the latest retail stock news and events to better inform your investing strategy Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Fibre2Fashion
12 hours ago
- Business
- Fibre2Fashion
US' Nike FY25 revenue falls 10%, net income drops 44%
American sports apparel company Nike, Inc has recorded a revenue of $46.3 billion in full fiscal 2025 (FY25) ended May 31, representing a 10 per cent decline on a reported basis and 9 per cent on a currency-neutral basis. Nike brand revenues were down 9 per cent to $44.7 billion, with declines seen across all geographies. Nike direct revenues fell 13 per cent to $18.8 billion, driven by a 20 per cent drop in digital sales, while Nike-owned store sales remained flat. Wholesale revenues fell 7 per cent to $25.9 billion. Converse revenues dropped 19 per cent to $1.7 billion. Nike, Inc has reported revenues of $46.3 billion in FY25, down 10 per cent, with net income plunging 44 per cent to $3.2 billion. Q4 revenue fell 12 per cent to $11.1 billion, and net income dropped 86 per cent. Declines were driven by weak digital sales, higher discounting, and restructuring under its 'Win Now' strategy and new 'sport offense' realignment to drive future growth. The gross margin declined 190 basis points (bps) to 42.7 per cent, impacted by higher discounts, changes in channel mix, and inventory obsolescence reserves. Selling and administrative expenses decreased 3 per cent to $16.1 billion, with demand creation expense rising 9 per cent to $4.7 billion and operating overhead falling 7 per cent to $11.4 billion. The effective tax rate rose to 17.1 per cent from 14.9 per cent in the prior year. Net income declined 44 per cent to $3.2 billion, with diluted earnings per share (EPS) at $2.16, down 42 per cent. Inventories stood at $7.5 billion (flat year-on-year) as of May 31, 2025, and cash and short-term investments totalled $9.2 billion, down $2.4 billion, mainly due to share repurchases, dividends, bond repayments, and capital expenditures. 'While our financial results are in-line with our expectations, they are not where we want them to be. Moving forward, we expect our business to improve as a result of the progress we're making through our Win Now actions,' said Elliott Hill, president and chief executive officer (CEO) at Nike . 'As we enter a new fiscal year, we are turning the page, and the next step is aligning our teams to lead with sport through what we are calling the sport offense. This will accelerate our Win Now actions to reposition our business for future growth.' The sport offense realignment will focus on driving distinction within key sports, building a complete product portfolio, creating stories to inspire and connect with consumers, and elevating and growing the entire marketplace, Nike said in a press release. In the fourth quarter (Q4) of FY25, revenues totalled $11.1 billion, down 12 per cent on a reported basis and 11 per cent on a currency-neutral basis. Nike Brand revenues dropped 11 per cent to $10.8 billion. Meanwhile, Nike direct revenues fell 14 per cent to $4.4 billion in Q4, led by a 26 per cent decrease in Nike brand digital, partially offset by a 2 per cent rise in Nike-owned store sales. The wholesale revenues were $6.4 billion, down 9 per cent, and converse revenues declined 26 per cent to $357 million. The gross margin fell 440 bps to 40.3 per cent due to higher discounting and unfavourable channel mix, added the release. The selling and administrative expenses rose 1 per cent to $4.1 billion, with demand creation expenses increasing 15 per cent to $1.3 billion. The operating overhead fell 3 per cent to $2.9 billion. Net income plunged 86 per cent to $0.2 billion, with diluted EPS at $0.14. 'The fourth quarter reflected the largest financial impact from our Win Now actions, and we expect the headwinds to moderate from here. I am confident in our ability to navigate through this current dynamic and uncertain environment by focusing on what we can control and executing our Win Now actions,' said Matthew Friend, executive vice president and chief financial officer (CFO) at Nike . Fibre2Fashion News Desk (SG)
Fashion United
14 hours ago
- Business
- Fashion United
Nike's 'Sport Offense' strategy aims to reposition business after sharp revenue decline
Nike announced its financial results for the fourth quarter and full year, which concluded on May 31, 2025. The athletic footwear and apparel giant reported full-year revenues of 46.3 billion dollars, marking a 10 percent decrease on a reported basis. The fourth quarter similarly saw a downturn, with revenues reaching 11.1 billion dollars, down 12 percent. "While our financial results are in-line with our expectations, they are not where we want them to be. Moving forward, we expect our business to improve as a result of the progress we're making through our Win Now actions," said Elliott Hill, president & CEO, Nike, Inc. "As we enter a new fiscal year, we are turning the page and the next step is aligning our teams to lead with sport through what we are calling the sport offense. This will accelerate our Win Now actions to reposition our business for future growth," Hill added. The fourth quarter performance revealed significant declines across key segments. Nike Direct revenues fell 14 percent to 4.4 billion dollars on both a reported and currency-neutral basis, largely due to a 26 percent decrease in Nike Brand Digital sales, partially offset by a 2 percent increase in Nike-owned stores. Wholesale revenues for the quarter also decreased by 9 percent to 6.4 billion dollars. Furthermore, Converse revenues experienced a drop of 26 percent to 357 million dollars, impacted by declines across all territories. Gross margin for the fourth quarter decreased by 440 basis points to 40.3 percent. Diluted earnings per share for the quarter stood at 14 cents, representing an 86 percent decrease, while net income also saw an 86 percent decline to 0.2 billion dollars. "The fourth quarter reflected the largest financial impact from our Win Now actions, and we expect the headwinds to moderate from here," said Matthew Friend, executive vice president & chief financial officer, Nike.
Business of Fashion
5 days ago
- Business
- Business of Fashion
This Week: Nike's Earnings and Jonathan Anderson's Dior Debut
We're all economics nerds in a post-Liberation Day world, so in a sense, this week's big reveal will be the Conference Board's monthly gauge of US consumer confidence, due out Tuesday. That survey will only tell us something about whether people are shopping, however. To find out what they'll be buying, we have Nike and Dior. Nike's Multifaceted Turnaround What's Happening: Nike reports fourth-quarter and full-year results on June 26. Analysts have an average forecast for sales to drop 15 percent for the quarter and 11 percent for the year, along with a sharp contraction in profits. Eye on the Horizon: Most have written off Nike's fiscal 2025, and will be instead watching for whether the sportswear giant releases guidance for the coming year, along with CEO Elliott Hill's outlook on the earnings call Thursday afternoon. FOMO: Nike watchers assume it's only a matter of time before the brand enters a new golden age, or at least halts its decline. Exactly when that will happen is the billion-dollar question; in a research note, UBS said Nike's stock may even be priced artificially high because investors worry they'll mistime the rebound (remarkable, given shares are trading close to an eight-year low). That dynamic provides Nike leadership a bit of breathing room to implement their plans, though it also increases the consequences if they push out their turnaround timeline. ADVERTISEMENT About Those Plans…: Nike learned the hard way why you don't put all your eggs in one basket, after its retro sneaker boom went bust. Along with marking down holdover Dunks, Nike is seeding numerous potential comeback efforts, including its (yes, retro) Vomero running shoe, the soccer cleat-inspired Cryoshots and reviving women's basketball sneakers with a signature shoe from the WNBA's A'ja Wilson. And of course there's NikeSkims, the new lifestyle sub-brand with Kim Kardashian. Even Nike-owned Converse is pitching in with a much talked about (though still unreleased) sneaker with basketball star Shai Gilgeous-Alexander. Patience Please: Any or all of these efforts could be the next great Nike franchise, but it will take years of meticulous execution to pull off. We'll find out Thursday if the company is confident enough in its plans to put a date on its return to form. A Big Debut at Dior Jonathan Anderson speaking at BoF Voices in 2023. (Getty Images) What's Happening: Jonathan Anderson makes his much-anticipated Dior debut with a men's show in Paris on June 27, the first and perhaps the biggest in a series of major designer debuts slated for the coming months. A Long Time Coming: Anderson was named creative director of Dior Men's in April, though his long-rumoured appointment to replace Maria Grazia Chiuri wasn't made official until earlier this month. Debuting with a men's show, rather than couture or women's, could be seen as a 'soft launch,' though given the many months of anticipation and the stakes, his collection won't lack for attention. Needing a Spark: The luxury sector is mired in its worst downturn in years. LVMH's brands, which initially defied the trend, are now struggling to keep customers engaged just like everyone else (though declines, while significant, are nowhere near the carnage at Gucci or Burberry). Creative directors can only do so much, but having the right vision and products makes the changes to supply chains and pricing architecture needed to revive the industry's prospects go down easier. The Week Ahead wants to hear from you! Send tips, suggestions, complaints and compliments to
