A man walks in front of an exhibition of Nike products on February 22, 2021 in New York City.
John Smith | Corbis News | Getty Images
Nike released on Thursday that quarterly sales did not hit the target, as widespread congestion in ports in the United States and the closure of stores in Europe linked to the pandemic weighed on the results.
The retailer has yet to offer prospects for the entire year.
Its shares fell more than 2% in after-hours trading.
See how Nike fared during the quarter ended February 28, compared to what analysts expected, based on a Refinitiv survey:
- Earnings per share: 90 cents versus expected 76 cents
- Revenue: $ 10.36 billion versus expected $ 11.02 billion
Nike posted a net profit of $ 1.45 billion, or 90 cents per share, compared to $ 847 million, or 53 cents per share, a year earlier. This was better than the 76 cents a share that analysts expected, based on data from Refinitiv.
Total sales increased to $ 10.36 billion, from $ 10.1 billion a year earlier. This was less than the $ 11.02 billion forecast by analysts.
In North America, revenue fell 10% year on year, hampered by delays in shipments that Nike said had dragged on for more than three weeks. This also meant that sales at its wholesale partners were impacted, as companies such as department stores and sporting goods stores did not receive the goods on time. They will probably now need to discount some of these goods to make room on the shelf for more seasonal styles.
Backward ports on the west coast, a global shortage of containers and a shortage of truckers in the U.S. continue to be headaches for companies from Nordstrom to Urban Outfitters and Peloton. Many said they expect these problems to drag on into the second half.
In the Europe, Middle East and Africa region, Nike said sales at its physical retail stores fell due to pandemic-related closings and restrictions, while digital sales in those markets grew 60% in the last period. According to her, about 60% of its stores in the region are open today, with some operating at reduced hours.
In Greater China, the region that is most advanced in recovering from the pandemic, sales increased 51%.
Nike’s direct consumer business grew 20% year-over-year to $ 4 billion. And online sales for the Nike brand increased 59% as consumers sought to add new sneakers and sports equipment to their wardrobes, even if they were stuck at home.
“We continue to see the value of a more direct and digital strategy, fueling even greater potential for Nike in the long run,” said Chief Financial Officer Matt Friend.
Nike shares have risen more than 110% in the past 12 months, since the market closed on Thursday. It has a market capitalization of more than $ 225 billion.
Find the full Nike press release here.
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