In light of the cumulative tightening of monetary policy, the consumer spending has shown some signs of cooling off, which further take a toll on the retailers, just like Nike.
.Nike fell about 12% in recent trading session on the heels of unveiling plans to cut costs by about $2 billion over the next three years as it lowered its sales outlook, and shares were up 4.7% so far this year, lagging far behind the S&P 500's gains for the year.
Nike now expects full-year reported revenue to grow approximately 1%, compared to a prior outlook of up mid-single digits. In the current quarter, which includes the second half of the holiday shopping season, Nike expects reported revenue to be slightly negative as it laps tough prior year comparisons, and sales to be up low single digits in the fourth quarter.
Nike right now is facing a number of risks in its operating environment, including the effects of a stronger U.S. dollar on foreign currency translation, consumer demand over the holiday season and its second half wholesale order books. Looking forward, the impact of these risks is becoming clearer.
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