Nike Posts Higher Sales in U.S., China -- Update
December 19 2019 - 6:42PM
Dow Jones News
By Kimberly Chin
Nike Inc. posted a 10% jump in sales in the latest quarter, even
after the sportswear giant decided to stop selling through
Amazon.com Inc. and faced criticism for its support of disgraced
running coach Alberto Salazar.
Revenue in the North American market, which accounts for the
majority of Nike's sales, rose 5% from a year ago. The gains were
driven by footwear, as apparel sales were flat. The fastest-growing
region was Greater China, where revenue jumped 20% from a year
ago.
Executives said apparel sales were flat in North America because
of the boost that business got a year earlier, when basketball star
and Nike endorser LeBron James joined the Los Angeles Lakers,
lifting sales of his jerseys. Nike has the exclusive rights to make
National Basketball Association jerseys.
Nike's shares, which have climbed 36% this year, were down 2% at
$99.25 in after-hours trading.
In November, Nike said it would stop selling its clothes and
sneakers directly on Amazon to focus on its own apps and stores.
The company sold a relatively small amount of goods on the site,
though many third parties resell Nike products there.
Instead, Nike has tried to drive consumers to its own shopping
apps and reduce its reliance on traditional retailers. In the
latest quarter, Chief Executive Mark Parker said digital revenue
rose 38% from a year ago, including a jump of more than 70% on
Black Friday in North America.
For the fiscal second quarter ended Nov. 30, Nike reported a
profit of $1.12 billion, or 70 cents a share, up from $847 million,
or 52 cents a share, a year ago. Overall sales were $10.3 billion
for the quarter and exceeded analysts' estimates of $10.1
billion.
The company expects a high single-digit-percentage increase in
reported revenue growth for the full fiscal year, finance chief
Andy Campion said on a conference call. Nike expects growth in the
third quarter to be in line with the first quarter, when revenue
rose 7%, he said.
During the quarter, Nike came under scrutiny for its silence on
the Hong Kong protests and its support for Mr. Salazar, who
received a four-year ban for doping. Mr. Salazar has said he
planned to appeal the sanction. He also has disputed allegations
from some former female athletes that he mistreated them.
On Oct. 1, Mr. Mark Parker sent an email to Nike employees
saying the company would never condone cheating and underscoring
his support for Mr. Salazar. A few days later, Mr. Parker said the
company was disbanding the Nike Oregon Project, an elite running
team Mr. Salazar coached.
About two weeks later, Mr. Parker said he would step down as CEO
in January and become executive chairman. John Donahoe, a former
eBay Inc. chief executive and a current member of Nike's board,
will take over as CEO in January.
"This has been a very thoughtful transition that has been
planned for many months," Mr. Parker said on Thursday. "Our brand
and our business are as strong as they've ever been."
Write to Kimberly Chin at kimberly.chin@wsj.com
(END) Dow Jones Newswires
December 19, 2019 18:27 ET (23:27 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
Nike (NYSE:NKE)
Historical Stock Chart
From Aug 2024 to Sep 2024
Nike (NYSE:NKE)
Historical Stock Chart
From Sep 2023 to Sep 2024