Nike said it’s closed half of its stores in China as the government tries to contain a new virus outbreak there, saying it will have a “material impact” on its operations across the country.
“This situation was not contemplated at the time we provided Q3 guidance during our Q2 fiscal year 2020 earnings call,” the company said in a statement released after the markets closed Tuesday. “Dynamics continue to evolve and accordingly we will provide an update on the operational and financial impacts on our Q3 earnings call.”
According to Nike, half of its stores within the marketplace have been temporarily closed, and the ones that are opened are operating with reduced hours — as stores are “experiencing lower than planned retail traffic.”
“First and foremost, our thoughts are with the people affected and we remain focused on the health and safety of our teammates and partners,” CEO John Donahoe said in a statement.
Other companies that have been affected by the coronavirus, which may be more contagious than data shows, are the 41 casinos, including MGM Resorts, in Macao. The Macao government has requested a cease in operations for the next 15 days, but can be extended if deemed necessary.
“Despite this difficult situation, NIKE’s long-term opportunity to continue to serve consumers in Greater China with inspiration and innovation remains exceedingly strong,” Donahoe continued, staying optimistic. “At the same time, we continue to have extraordinary brand and business momentum in all other geographies.”
More than 20,000 people across the world have been infected with more than 420 deaths since the yet-to-be-named coronavirus first emerged in Wuhan, China on Dec. 31.
Source: CNBC
