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Fashion Network
02-07-2025
- Business
- Fashion Network
Trump's Vietnam trade deal lifts Nike, Under Armour, Levi Strauss shares
Shares of Nike and other apparel makers rose on Wednesday after U.S. President Donald Trump said he had struck a trade deal with Vietnam that would impose a lower-than-expected tariff rate on many imports from the Southeast Asian country. After months of negotiations, Trump's trade deal with Vietnam includes a 20% tariff on imports from Vietnam, lower than the initial 46% rate he had announced in April. Apparel makers have been diversifying production away from China to Vietnam, Cambodia and Indonesia, as Trump's reciprocal tariffs on imports from these countries proposed in April raised concerns over supply chain costs and higher product prices. 'Investors may be looking at this as a sign that many of the threatened tariffs (on Vietnam and other countries) will be rescinded,' Morningstar Research analyst David Swartz said. The deal also includes a 40% levy on transshipments from third countries. Trump said in a post on Truth Social that Vietnam would provide the U.S. with greater market access, with no tariffs on U.S. exports into Vietnam. Nike's shares were up nearly 3.6%, Under Armour rose 2.3%, and Levi Strauss gained 1.6%. Shares in Gap and Abercrombie & Fitch were up less than 1%. According to the company's annual filing, Vietnam manufactured about 50% of the total Nike brand footwear in fiscal 2024. North America is Nike's largest market in terms of revenue. Tariffs could add about $1 billion to its costs, but Nike expects to fully mitigate the impact over time, it said last week. Shares of electronics retailer Best Buy were up marginally. The company had factored in Trump's base tariff rate of 10% in its annual forecast in May. 'The transshipping aspect is an important wrinkle, but I'd expect suppliers will quickly move to adjust supply chains to avoid paying that hefty duty,' said Matthew McCartney, analyst at Wedbush Securities. 'Bigger picture, this deal brings clarity to the industry for a critical consumer electronics hub and eliminates some downside risk to Best Buy's outlook.' The companies — including Nike, Adidas, Puma
Fashion Network
02-07-2025
- Business
- Fashion Network
Trump's Vietnam trade deal lifts Nike, Under Armour, Levi Strauss shares
Shares of Nike and other apparel makers rose on Wednesday after U.S. President Donald Trump said he had struck a trade deal with Vietnam that would impose a lower-than-expected tariff rate on many imports from the Southeast Asian country. After months of negotiations, Trump's trade deal with Vietnam includes a 20% tariff on imports from Vietnam, lower than the initial 46% rate he had announced in April. Apparel makers have been diversifying production away from China to Vietnam, Cambodia and Indonesia, as Trump's reciprocal tariffs on imports from these countries proposed in April raised concerns over supply chain costs and higher product prices. 'Investors may be looking at this as a sign that many of the threatened tariffs (on Vietnam and other countries) will be rescinded,' Morningstar Research analyst David Swartz said. The deal also includes a 40% levy on transshipments from third countries. Trump said in a post on Truth Social that Vietnam would provide the U.S. with greater market access, with no tariffs on U.S. exports into Vietnam. Nike's shares were up nearly 3.6%, Under Armour rose 2.3%, and Levi Strauss gained 1.6%. Shares in Gap and Abercrombie & Fitch were up less than 1%. According to the company's annual filing, Vietnam manufactured about 50% of the total Nike brand footwear in fiscal 2024. North America is Nike's largest market in terms of revenue. Tariffs could add about $1 billion to its costs, but Nike expects to fully mitigate the impact over time, it said last week. Shares of electronics retailer Best Buy were up marginally. The company had factored in Trump's base tariff rate of 10% in its annual forecast in May. 'The transshipping aspect is an important wrinkle, but I'd expect suppliers will quickly move to adjust supply chains to avoid paying that hefty duty,' said Matthew McCartney, analyst at Wedbush Securities. 'Bigger picture, this deal brings clarity to the industry for a critical consumer electronics hub and eliminates some downside risk to Best Buy's outlook.' The companies — including Nike, Adidas, Puma
Fashion Network
02-07-2025
- Business
- Fashion Network
Trump's Vietnam trade deal lifts Nike, Under Armour, Levi Strauss shares
Shares of Nike and other apparel makers rose on Wednesday after U.S. President Donald Trump said he had struck a trade deal with Vietnam that would impose a lower-than-expected tariff rate on many imports from the Southeast Asian country. After months of negotiations, Trump's trade deal with Vietnam includes a 20% tariff on imports from Vietnam, lower than the initial 46% rate he had announced in April. Apparel makers have been diversifying production away from China to Vietnam, Cambodia and Indonesia, as Trump's reciprocal tariffs on imports from these countries proposed in April raised concerns over supply chain costs and higher product prices. 'Investors may be looking at this as a sign that many of the threatened tariffs (on Vietnam and other countries) will be rescinded,' Morningstar Research analyst David Swartz said. The deal also includes a 40% levy on transshipments from third countries. Trump said in a post on Truth Social that Vietnam would provide the U.S. with greater market access, with no tariffs on U.S. exports into Vietnam. Nike's shares were up nearly 3.6%, Under Armour rose 2.3%, and Levi Strauss gained 1.6%. Shares in Gap and Abercrombie & Fitch were up less than 1%. According to the company's annual filing, Vietnam manufactured about 50% of the total Nike brand footwear in fiscal 2024. North America is Nike's largest market in terms of revenue. Tariffs could add about $1 billion to its costs, but Nike expects to fully mitigate the impact over time, it said last week. Shares of electronics retailer Best Buy were up marginally. The company had factored in Trump's base tariff rate of 10% in its annual forecast in May. 'The transshipping aspect is an important wrinkle, but I'd expect suppliers will quickly move to adjust supply chains to avoid paying that hefty duty,' said Matthew McCartney, analyst at Wedbush Securities. 'Bigger picture, this deal brings clarity to the industry for a critical consumer electronics hub and eliminates some downside risk to Best Buy's outlook.' The companies — including Nike, Adidas, Puma
Business of Fashion
27-06-2025
- Business
- Business of Fashion
Nike Fourth-Quarter Sales Fall by Less Than Expected
Nike said it would cut its reliance on production in China to mitigate the impact from US tariffs on imports, and forecast a smaller-than-expected drop in first-quarter revenue, sending its shares up 11 percent in extended trading. US President Donald Trump's sweeping tariffs on imports from key trading partners could add around $1 billion to Nike's costs, company executives said on a post-earnings call after the sportswear giant topped estimates for fourth-quarter results. China, subject to the biggest tariff increases imposed by Trump, accounts for about 16 percent of the shoes Nike imports into the United States, chief financial officer Matthew Friend said. But the company aims to cut the figure to a 'high single-digit percentage range' by the end of May 2026 as it shifts production to other countries. Consumer goods is one of the most affected areas by the tariff dispute between the world's two largest economies, but Nike's executives said they were focused on cutting the financial pain. Nike will 'evaluate' corporate cost reductions to deal with the tariff impact, Friend said. The company has already announced price increases for some products in the U.S. 'The tariff impact is significant. However, I expect others in the sportswear industry will also raise prices, so Nike may not lose much share in the US,' said David Swartz, analyst at Morningstar Research. Running Finds Its Footing Chief executive Elliott Hill's strategy to focus product innovation and marketing around sports is beginning to show some fruit with the running category returning to growth in the fourth quarter after several quarters of weakness. Having lost share in the fast-growing running market, Nike has invested heavily in running shoes such as Pegasus and Vomero, while scaling back production of sneakers such as the Air Force 1. 'Running has performed especially strongly for Nike,' said Citi analyst Monique Pollard, adding that new running shoes and sportswear products are expected to offset the declines in Nike's classic sneaker franchises at wholesale partner stores. Marketing spending was up 15 percent year-on-year in the quarter. On Thursday, Nike hosted an event in which its sponsored athlete Faith Kipyegon attempted to run a mile in under four minutes. Paced by other star athletes in the glitzy and live-streamed from a Paris stadium, Kipyegon fell short of the goal but set a new unofficial record. Nike forecast first-quarter revenue to fall in the mid-single digits, slightly better than analysts' expectations of a 7.3 percent drop, according to data compiled by LSEG. Its fourth-quarter sales fell 12 percent to $11.10 billion, but still beat estimates of a 14.9 percent drop to $10.72 billion. China continued to be a pain point, with executives saying a turnaround in the country will take time as Nike contends with tougher economic conditions and competition. The company's inventory was flat year-over-year at $7.5 billion as of May 31. By Helen Reid and Juveria Tabassum. Reporting by Juveria Tabassum in Bengaluru; Editing by Shinjini Ganguli and Alan Barona. Learn more: Is Nike Finally Winning With Women? With the bold marketing like the 'So Win' campaign, a revamped leadership team under new brand president Amy Montagne and star power from A'ja Wilson, Nike's long-promised women's push is starting to stick.
Reuters
27-06-2025
- Business
- Reuters
Nigeria's Dangote aims to end Africa's fertiliser imports
LAGOS, June 27 (Reuters) - Africa will be self-sufficient in fertiliser within 40 months, Nigerian billionaire Aliko Dangote said on Friday, on the basis of a planned expansion of his $2.5 billion plant on the outskirts of Lagos. Africa currently imports over 6 million metric tons of fertiliser annually as it struggles to produce enough food in often challenging growing conditions. The benefits of increasing domestic production would include reduced foreign exchange expenditure, which has been a major economic burden in Nigeria because of the weakness of the local currency. "In the next 40 months, Africa will not import fertiliser from anywhere. We have a very aggressive trajectory right now. We want to put Dangote to be the highest producer of urea, bigger and higher than Qatar - give me 40 months," Dangote said at the annual Afreximbank meeting in Abuja. Dangote runs Africa's largest granulated urea complex, which has annual capacity of 3 million tons, 37% of which it exports to the United States. It will need to double current output to achieve his ambition. Dangote has said he is not worried about the impact of Trump tariffs. Analysts say the market outlook for fertiliser is bullish, but there are also challenges and the kind of expansion Dangote seeks requires infrastructure to be built. "Any new fertiliser plant or expansion project faces cost overrun risks to the producer," Seth Goldstein, senior equity analyst at Morningstar Research, said. Mikolah Judson, an analyst at global risk consultancy, Control Risk, cited the need for "transport infrastructure and port capacity," saying "bottlenecks routinely delay various import and export projects in Nigeria". Dangote has a track record for delivering big projects. He also owns the Dangote Petroleum Refinery, Africa's largest, although its launch was repeatedly delayed and it exceeded its initial budget. He has said he intends to list the 650,000 barrels-per-day refinery next year and on Friday he also confirmed plans to list his fertiliser plant on the local stock exchange this year.
