• About
  • Privacy & Policy
  • Contact Us
Procurement Nation
  • Home
  • Suppliers
  • Procurement
    • Shipping
    • Best Procurement Software
    • Supply Chain
      • What is supply chain management?
      • Tyson Foods Food Supply Chain
  • Markets
  • Banking
  • Contact Us
No Result
View All Result
  • Home
  • Suppliers
  • Procurement
    • Shipping
    • Best Procurement Software
    • Supply Chain
      • What is supply chain management?
      • Tyson Foods Food Supply Chain
  • Markets
  • Banking
  • Contact Us
No Result
View All Result
Procurement Nation
No Result
View All Result

Nike misses sales estimates as holidays, supply chain crunch loom

Mark White by Mark White
September 23, 2021
in Shipping
0

Nike shoes are seen displayed at a sporting goods store in New York City, New York, U.S., May 14, 2019. REUTERS/Mike Segar/File Photo

Sept 23 (Reuters) – Nike Inc (NKE.N) missed estimates for quarterly revenue on Thursday, signaling weaker-than-expected demand as it struggles with a supply chain crunch in Vietnam ahead of the crucial holiday shopping season.

The Beaverton, Oregon-based company’s shares, which are down about 9% from their record high hit in August, initially fell 3% in extended trading before paring back to 1.5% lower.

Months long factory closures in Vietnam, where about half of all Nike footwear is manufactured, have piled more pressure on global supply chains, which are already reeling under the impact of the pandemic, with some analysts predicting that Nike will be short of products during the crucial holiday shopping season.

Brokerage BTIG this month downgraded Nike’s stock, saying “the risk of significant cancellations beginning this holiday and running through at least next spring has risen materially for Nike.”

The company is facing at least two months of “virtually no unit production at its Vietnamese factories which accounted for 51% of footwear and 30% of apparel units (43% of total units) last year,” BTIG analysts wrote in a note.

Nike did not address its supply chain issues in Vietnam in its earnings statement, but did nod to higher product expenses primarily due to increased freight costs.

To be sure, other apparel companies including Abercrombie & Fitch (ANF.N) and Adidas AG (ADSGn.DE) have taken a hit to their businesses due to production issues in Vietnam. Lockdowns in many parts of the country are set to last at least until the end of September.

Apparel retailers have also had to grapple with higher raw material and spend more on shipping to get their products in stores on time as the COVID-19 pandemic takes a toll on global supply chains.

Retailer inventories are already trending at historic lows, with data from the Federal Reserve Bank of St. Louis showing that at the end of August, stores had enough merchandise to cover only a little more than 1 month of sales, a sharp drop from the near 2-month lead they had in April last year.

Nike said revenue rose to $12.25 billion from $10.59 billion in the first quarter ended Aug. 31, while analysts on average had expected $12.46 billion, according to IBES data from Refinitiv.

Nike’s net income rose 23% to $1.87 billion, or $1.16 per share, in the first quarter.

Reporting by Uday Sampath in Bengaluru and Richa Naidu in Chicago. Additional reporting by Siddharth Cavale; Editing by Anil D’Silva and Diane Craft

Our Standards: The Thomson Reuters Trust Principles.

Source link

Previous Post

Semiconductor Shortage: Biden Considers Using Defense Production Act – Bloomberg

Next Post

Hackers breached computer network at key US port but did not disrupt operations

Mark White

Mark White

Mark White is the editor of the ProcurementNation, a Media Outlet covering supply chain and logistics issues. He joined The New York Times in 2007 as an commodities reporter, and most recently served as foreign-exchange editor in New York.

Next Post
Hackers breached computer network at key US port but did not disrupt operations

Hackers breached computer network at key US port but did not disrupt operations

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

  • About
  • Privacy & Policy
  • Contact Us
Call us: +1 234 JEG THEME

© 2021 Procurement Nation - Supply Chain & Logistics News

No Result
View All Result
  • Procurement
  • Supply Chain
  • Logistics
  • Science
  • Technology

© 2021 Procurement Nation - Supply Chain & Logistics News