Nike (NYSE:NKE) posted fiscal third-quarter results on Thursday that beat Wall Street’s expectations as the iconic apparel maker offset currency headwinds with stronger revenue and margin expansion.
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Shares of the Dow Industrials member rose 2% in extended trading on the earnings and revenue beat.
Nike said it earned $685 million, or 76 cents per share, last quarter, compared with $866 million, or 73 cents per share, a year earlier. Analysts had called for more modest EPS of 72 cents.
Revenue rose 13% to $6.97 billion, topping the Street’s view of $6.81 billion. Gross margins ticked up to 44.5% from 44.2% thanks to higher average prices and growth in the higher margin direct-to-consumer business.
Nike reported currency neutral futures orders growth of 14% as of the end of February, exceeding the Street’s view of 11.8%. North American futures orders were up 9%, compared with estimates for 10.6%.
Emerging market futures orders soared 24% as of the end of the third quarter, compared with 30% in Western Europe and 13% in Central and Eastern Europe. Orders were down 3% in Greater China and off 1% in Japan.
“Our strong Q3 results demonstrate our relentless focus on delivering innovations that resonate with consumers," Nike CEO Mark Parker said in a statement. "Despite macroeconomic challenges, Nike delivers consistent results because we focus on the biggest opportunities for growth while we manage risk across our diverse global portfolio.”
Nike also said its inventories stood at $3.8 billion as of the end of the quarter, up 12% from the year before.
Shares of Beaverton, Ore.-based Nike advanced 1.9% to $80.78 in extended trading on Thursday. The rally positions them to extend their 12-month rally of about 44%.