Sneaker and athletic apparel giant Nike (NKE) issued quarterly results that beat Wall Street
expectations on both the top and bottom lines.
The Beaverton, Oregon-based company said that demand for its sneakers and sportswear held
up during its fiscal fourth quarter despite renewed COVID-19 lockdowns in China and high
inflation around the world.
Nike reported earnings per share of $0.90 U.S. versus $0.81 U.S. that had been expected. The
company’s revenue came in at $12.23 billion U.S. compared to $12.06 billion U.S. forecast by
analysts.
Nike reported net income for the three-month period ended May 31 of $1.44 billion U.S.,
compared with $1.51 billion U.S. a year earlier. The company said some challenges, such as
high transportation costs and long shipping times, are persisting this year.
Looking ahead, Nike said it anticipates first quarter revenue will be flat to slightly up versus the
year earlier period as it continues to manage the various challenges it faces around the world.
The company added that it anticipates full-year revenue growth in the low double digits.
Nike is in the middle of a strategy shift as the company sells more merchandise directly to
shoppers via online channels and scales back the amount of products sold by retail partners.
Nike said its direct sales grew 7% to $4.8 billion U.S. in the quarter versus the year earlier
period. Nike’s wholesale business, or items sold through third-party retailers, dropped 7% to
$6.8 billion U.S.
In North America, Nike’s largest market, total sales fell by 5% to $5.11 billion U.S. in the fourth
quarter. In Greater China, the company’s sales took a bigger hit due to COVID-19 lockdowns,
dropping by 19% to $1.56 billion U.S.
In the three-month period, Nike said its inventory rose to $8.4 billion U.S., up 23% versus the
year-ago period, driven by longer lead times from ongoing supply chain disruptions.
Nike said its board of directors has authorized a new four-year $18 billion U.S. stock buyback
program. It will replace the company’s previous $15 billion U.S. share buyback program.
Shares of Nike are down 33% so far this year at $110.50 U.S. each.
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