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Fibre2Fashion
a day 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)
Yahoo
04-04-2025
- Business
- Yahoo
Trending tickers: latest investor updates on Apple, Nike, Starbucks, Best Buy and Restoration Hardware
Apple (AAPL) saw its market value plunge by more than $300bn on Thursday, making it one of Wall Street's biggest casualties following Donald Trump's latest tariff offensive. Shares in the iPhone maker fell more than 9% by the close of trading in New York on Thursday, wiping out its market capitalisation, which dropped from $3.36tn to $3.05tn (£2.59tn to £2.35tn)— marking its largest one-day valuation loss on record. The stock rebounded slightly in pre-market trading, and it is currently hovering just above the flatline. Trump's tariff push targeted Apple's (AAPL) key suppliers and manufacturing hubs across Asia, including China, Taiwan, India, and Vietnam, imposing hefty new tariffs on goods imported to the US. This move threatens to disrupt the production of nearly every Apple product, from iPhones to iPads, Macs, and accessories. The bulk of Apple's (AAPL) iPhones are manufactured in China, which has been slapped with a 54% tariff. If these tariffs remain in place, Apple faces a difficult decision: absorb the extra costs or pass them on to consumers. Read more: FTSE 100 LIVE: Trillions wiped off global stock markets as Trump's tariffs unleash chaos The launch price of the cheapest iPhone 16 model in the US was set at $799. However, according to calculations from analysts at Rosenblatt Securities, the price could surge by up to 43%, potentially driving the cost of the phone to $1,142 if Apple is able to shift the burden onto customers. For the higher-end iPhone 16 Pro Max, which boasts a 6.9-inch display and 1 terabyte of storage, the price could jump from its current retail price of $1,599 to as much as $2,300, should a 43% increase be passed down to consumers. Shares of footwear and sports apparel giant Nike (NKE) plunged more than 14% on Thursday following Trump's announcement of sweeping tariffs on trading partners, erasing $13.9bn in market value. Starting 5 April, all imports will face a baseline tariff of 10%. On 9 April, an additional rate will be applied to goods from about 60 countries. China, in particular, will see a 34% reciprocal tariff on top of the existing 20% tariff, bringing the total to 54%. Vietnam will face a 46% tariff, while Indonesia will see a 32% duty. Nike's (NKE) supply chain is heavily dependent on these countries. Factories in Vietnam, Indonesia and China produce approximately 50%, 27%, and 18% of Nike Brand footwear, respectively. Additionally, about 28%, 16%, and 15% of Nike Brand apparel is manufactured in Vietnam, China, and Cambodia, respectively. "What president Trump presented ... was a little bit more aggressive than what I think many people were hoping," Telsey Advisory Group's Joe Feldman told Yahoo Finance. Many retail companies "thought they were off the hook for a while because they didn't have a lot of exposure to China, or not a lot to Canada, Mexico ... [they're] clearly rethinking everything right now." Shares in the coffeehouse chain fell 11% in the last session and were muted in pre-market trading, as markets reacted negatively to Trump's tariffs blitz. The US announced on Wednesday its first tariffs on coffee imports since colonial times, with sweeping duties that are expected to increase costs and add complexity for importers and roasters already grappling with near-record prices. The tariffs include a 46% duty on coffee imports from Vietnam, the world's second-largest coffee producer, and a 32% tariff on imports from Indonesia, the fourth-largest grower. Coffee from Central and South American countries, including Brazil and Colombia, will face a 10% tariff. Vietnam is the third-largest supplier of coffee to the US, the world's largest coffee consumer, and primarily exports robusta coffee, which is commonly used in instant coffee and ready-to-drink cold beverages. Read more: How Trump's tariffs will impact your finances and the UK economy Despite the steep declines, Starbucks (SBUX) managed to limit losses by announcing a quarterly cash dividend of $0.61 per share of outstanding common stock. The dividend is scheduled to be paid on 30 May to shareholders of record as of May 16, 2025. Shares in Best Buy (BBY) plummeted over 17% during the last trading session and remained just below the flatline in pre-market trading after Citi (C) downgraded the stock to neutral from buy, citing the growing risks posed by tariffs to the company's sales. The downgrade follows Trump's announcement of reciprocal tariffs, which Citi (C) analysts described as worse than anticipated. The firm warned that these tariffs could weigh on both demand and supply chains, further impacting the retailer's bottom line. Citi (C) also flagged broader concerns, including rising recession risks, a slowdown in consumer spending, and the impact of higher tariffs on goods imported from China, Vietnam, Indonesia and India. According to projections from 20 analysts, the one-year price target for Best Buy (BBY) is currently set at an average of $89.53. The estimates range from a high of $110 to a low of $75, suggesting a potential upside of 42.54% from the current stock price of $62.81. Among 29 brokerage firms, Best Buy's (BBY) consensus recommendation stands at 2.6, which indicates a "hold" status. This rating scale ranges from 1 to 5, where 1 is a strong buy, and 5 denotes a sell. California-based luxury home goods retailer RH (RH) plummeted over 40% in the last session, as investors factored in the impact of Trump's latest tariff announcement and weighed disappointing fourth-quarter earnings. RH's (RH) chief executive, Gary Friedman, was unusually candid during the company's earnings call on Thursday. A transcript from the call captured the moment he first saw the sharp decline in stock price: 'I guess the stock was down based on some of the numbers we reported and then it got killed because of — really, [Oh sh*t], Okay, I just looked at the screen. I hadn't looked at it,' Friedman said, acknowledging that he believed the tariffs had taken a heavy toll on the company's stock. 'It got hit when I think the tariffs came out,' he added, noting that many of RH's (RH) products come from Asia, which has been significantly impacted by the new tariffs. Stocks: Create your watchlist and portfolio The company's earnings report also didn't help matters. RH (RH) reported adjusted earnings of $1.58 per share, falling short of analysts' expectations of $1.92 per share, according to FactSet. In addition, the company's full-year 2025 guidance forecasted revenue growth of 10% to 13%, which was below the consensus estimate of 14.6%. The annual adjusted operating margin outlook ranged from 14% to 15%, missing the expected 14.9%. Analysts at Morgan Stanley (MS) flagged RH's struggles with 'slowing revenue' in a note to clients, attributing the downturn to cautious consumer sentiment amid concerns over the potential fallout from Trump's trade policies. Other companies in the news on Friday 4 April: Yaskawa (6506.T) Sodexo ( Asahi (2502.T)Sign in to access your portfolio
