European sportswear stocks run in Nike's wake

(Il Sole 24 Ore Radiocor) - Sportswear stocks surged on European stock exchanges in the wake of Nike, which announced better-than-expected accounts and plans to reduce production in China in an anti-tariff move. The US giant climbed 11% in US after-hours trading and is moving ahead in Frankfurt today morning. In hot pursuit are the stocks of European groups, starting with the British retail chain Jd Sports Fashion in London, with the best performance of the Ftse 100 index and the Stoxx Europe. In Frankfurt, Adidas and Puma shone with a leap.

Nike reported a lower-than-expected quarterly revenue drop on the eve of the event, driven by demand for its new products and trainer lines. The US company's fourth-quarter revenue fell 12% to $11.10 billion, while analysts had expected an average decline of 14.9% to $10.72 billion. Nike also announced its intention to reduce production in China to mitigate the impact of US tariffs on Chinese imports, group executives said during the financial results conference call. Cfo Matthew Friend said that China currently accounts for about 16% of the group's footwear imports to the US. "We expect this share to fall into the upper part of a figure by the end of the 2026 financial year, with a reallocation of supplies from China to other countries around the world," Friend told analysts. Nike has had a presence in China for 40 years. In the three months to 31 May, Nike's revenue in China fell 21% to $1.48 billion and in the 12 months revenue fell 13% to $6.59 billion. The Nike Group posted sales of $46.3 billion in the year to the end of May, down from $51.4 billion a year earlier. Net profit fell to $3.219 billion from $5.7 billion.