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Nike logo. (Photo=SNS) |
[Alpha Biz= Reporter Kim Jisun] Nike, the world's largest sports apparel retailer, saw its stock price plummet by nearly 20% in just one day. This sharp decline appears to be driven by ongoing concerns over Nike's declining sales over the past year and pessimistic forecasts for future revenue.
According to the New York Stock Exchange (NYSE) on the 28th (local time), Nike's stock closed at $75.37, down 19.98% ($18.82) from the previous day's trading. The stock dropped more than 10% in pre-market trading and extended its losses during regular trading hours.
One of the reasons cited for Nike's drastic stock drop in a single day is a "earnings shock." Nike reported that its sales for the fourth quarter of the fiscal year 2024 (May to July) were $12.6 billion, a 1.7% decrease from the same period last year.
The outlook for future sales is also bleak. Nike projected a roughly 10% decline in sales for the first quarter of the fiscal year 2025 (June to August), which is more than triple the market expectation of a 3.2% decrease, according to market research firm LSEG.
For the entire fiscal year 2025, Nike expects sales to decline in the mid-single-digit range, a significant revision from the previous market expectation of a 0.9% increase. Earlier forecasts indicated a "low-single-digit decline" for the first half of the fiscal year, which has now been adjusted to a "high-single-digit decline."
Despite recording a 1% increase in total sales for the fiscal year 2024 compared to the previous year, amounting to $51.36 billion, this performance is considered one of the lowest since 2010 when excluding the pandemic period.
알파경제 Kim Jisun Reporter(stockmk2020@alphabiz.co.kr)
