Nike has posted a drop in its quarterly sales as rising online revenue failed to offset declines owing to mandated store closures across its bricks-and-mortar network.
The sportswear brand posted a 38% drop in revenue to $6.3bn (£5.1bn) in its fourth quarter, as 90% of its store network across the Americas, Europe and Asia were forced to close for approximately eight weeks because of coronavirus.
Although online sales jumped 75% during this time and accounted for 30% of overall revenue, this was insufficient to offset the hit to sales caused by store closures, as wholesale shipments fell by half.
Gross margin declined 820 basis points during the quarter as higher average selling prices were offset by factors including factory cancellation charges.
Conversion rates climb
Today approximately 90% of Nike stores have reopened and conversion rates are up year on year.
Across its full financial year to May 31 sales dipped 4% to $37.4bn (£30.2bn), while net income declined 36% to $2.5bn (£2bn).
Chief executive John Donahoe said: “In a highly dynamic environment, the Nike brand continues to resonate strongly with consumers all over the world as our digital business accelerates in every market.
“We are uniquely positioned to grow, and now is the time to build on Nike’s strengths and distinct capabilities. We are continuing to invest in our biggest opportunities, including a more connected digital marketplace, to extend our leadership and fuel long-term growth.”
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