NEW YORK (S&P Global Ratings) June 26, 2020--NIKE Inc.'s (AA-/Stable/A-1+) reported results for the fiscal year ended May 31, 2020, showed a significant impact from store closures and economic fallout related to COVID-19. Revenue declined 38% in the company's fourth quarter and operating profit turned negative because of steep gross margin decline driven by higher cost of products, inventory cancellation charges, and lack of sales leverage. We are maintaining our stable outlook on NIKE. While leverage increased significantly to the low-1x area at end of May 2020, from only about 0.4x in the year ago quarter, we expect the company to continue to adjust its cost structure and inventory position to better align with slower sales growth. The company remains
