American sportswear and footwear manufacturer Nike increased revenue by five percent to $12.8 billion (CZK 279 billion) in the fourth financial quarter, beating analysts’ estimates. But the new discount promotions hurt the company’s margins. The company stated this in its statement on Thursday.
China is buying again
Analysts polled by Refinitiv estimated sales at $12.59 billion. The world’s largest sportswear maker benefited from a recovery in China, where sales rose 16 percent after the end of strict anti-Covid policies. Affluent shoppers have been shopping popular Nike shoes including the Invincible 3 and Jordan Mid-1 after the lifting of pandemic measures in major Chinese cities.
The consequences of high inflation
Sales in the company’s biggest market, North America, rose five percent, but it was the slowest growth in four quarters. High inflation is to blame, according to Reuters. As people save more, retailers have started cutting back on orders.
The company offered more discounts to get rid of excess inventory of clothing and shoes, which attracted more customers to its stores. But that hurt margins, which fell 1.4 percentage points to 43.6 percent.
Full-year revenue rose ten percent to $51.2 billion. Net income fell 16 percent to $5.1 billion.
source: ČTK
