The lower sales in the regions of China and North America have decreased the quarterly sales results of Nike as the company has projected modest growth in the revenue against the strong dollar, along with growing inflation and several other headwinds.
The company based in Oregon, which has enjoyed strong pricing at times during the novel coronavirus pandemic but has also faced the factory Covid-19 lockdowns in the region of Asia that have badly affected the inventories of the company, has now reported lower profits for the company’s fiscal fourth quarter.
Nike reported 1.4 billion in profits for the quarter ending May 31st, 2022, a 5% decrease from the past year on a 1% decrease in revenues to 12.2 billion dollars.
Neil Saunders, managing director of a retail consultancy, GlobalData said the results had been reasonably good but with some negativity in details. These include the strict inflationary environment of North America, which has been responsible for leading some consumers to cut back on discretionary investments.
Another problem is China, where the Covid-19 lockdowns are creating sudden swings in the behaviour of the consumers should be a recovery as the country reopens, but this can be rapidly reversed if further Covid-19 lockdowns are imposed.
The shares of the company also retreated as Nike has forecasted the revenue flat to be a little high in the upcoming quarter.