EAGLE NICE (02368) shares fell more than 9% after the company issued a profit warning. As of the time of writing, the stock was down 8.22%, trading at HK$2.68 with a turnover of HK$2.1011 million.

The decline follows an announcement released by EAGLE NICE on the evening of May 22. The company expects its profit attributable to owners for the year ending March 31, 2026, to decrease significantly by not more than 30% compared to the previous year.

The board attributes the anticipated substantial decline in profit primarily to a significant performance downturn in the second half of the reporting year. Key contributing factors include increased production costs leading to higher cost of sales. This stems from the profound impact of tariff policies implemented by the U.S. government on several Southeast Asian countries where the group has production bases, which took effect in the first quarter of the reporting year.

Furthermore, the company's brand clients have adopted a more conservative and cautious stance in price negotiations. This shift is due to the severe cost pressures arising from the aforementioned tariff policies, changes in consumer demand, and intense competition within the sportswear manufacturing industry. These factors have collectively led to a decrease in the group's gross profit margin.