Adidas, Puma, and JD Sports all suffer from Nike’s earnings shortfall
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Adidas (DE:ADSGN) stock and Puma (DE:PUMG) stock fell sharply on Friday, as a disappointing update on Thursday by rival Nike (NYSE:NKE) sparked fears that the two won’t be able to get enough product to markets in North America and Europe in time for the key holiday season.
By 4:25 AM ET (0825 GMT), Adidas (OTC: ADDYY) stock was down 3.6% and Puma stock was down 2.9%. U.K. sports retailer JD (NASDAQ: JD) Sports Fashion (LON: JD) also fell in sympathy, by 2.3%. By comparison, the DAX index was down 0.8% and the FTSE 100 was down 0.3%Nike lowered its sales forecast for the current quarter and the year on Thursday, citing extended production shutdown in Vietnam due to Covid-19. Nike manufactures roughly half of their footwear in the Southeast Asian country. Nike also warned of shipment delays, which might have an impact on their Christmas performance.
Adidas, like Nike, has relocated much of its manufacture of footwear and soccer fleets from China to Vietnam during the previous decade. The German business had already warned in August that production closures would cost it 500 million euros in lost sales. However, this did not prevent it from raising its revenue guidance for the full year. It anticipates a 20% increase in sales this year, riding a prolonged surge of demand for leisure and sports clothing as more individuals alter their wardrobes to suit the increased time spent at home owing to social alienation.