Nike sales in China surged 11 per cent last year, marking the sixth consecutive year of double-digit growth in the market for the US sports brand.
The growth was achieved despite the impact of Covid-19 with sales of the flagship Nike brand rising by 1 per cent on a currency-neutral basis in the fourth quarter.
Globally, the latest Nike results make for far more sobering reading. With 90 per cent of its stores closed across the US, Europe and much of Asia Pacific for as many as eight weeks during the quarter, sales plunged 38 per cent to US$6.3 billion and the company reported a loss of $790 million. Asia-Pacific & Latin America sales fell 39 per cent during the period.
Digital sales, however, rose by 79 per cent in the fourth quarter worldwide, to represent about 30 per cent of the company’s total revenue, reflecting what the company described as an accelerated connection and engagement with consumers, based on a strengthened digital ecosystem.
“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,” said John Donahoe, Nike’s president and CEO.
“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.”
Nike sales in China are recovering quickly with almost every store now reopen across the country. “Retail traffic continues to improve week-over-week with higher conversion rates as compared to the prior year,” the company said in its results announcement.
“As physical retail re-opens, Nike’s strong digital trends continue, a testament to the strength of our brand and the investments we’ve made to elevate digital consumer experiences,” said Matt Friend, executive VP and CFO.
Full-year results show Nike sales fell 2 per cent year on year on a currency-neutral basis, due to Covid-19 impacting the second half. During the first half, sales were up 11 per cent. Net income was $2.5 billion, down 36 per cent.