Brandon Steiner shares his thoughts on Nike’s success, Yeezy’s failures and the business trends that Wall Street is supporting
Nike released mixed third quarter earnings results on Thursday, as the retailer was hit by congestion in U.S. ports, global pandemic-induced container shortages and store closures in Europe, while its direct consumer businesses continued to grow. the recipe.
Nike saw its revenue grow 2.5% compared to the previous year, with revenues of US $ 10.36 billion. The athletic outfitter admitted in a statement that his “revenue performance was impacted by disruptions related to the Covid-19 pandemic.”
Fortunately, before the pandemic changed the world at large, the Beaverton, Oregon-based company began adding muscle to its direct consumer businesses. As a result, the closure of third-party brick and mortar retailers did not affect Nike’s armor. Nike Direct – which operates digital outlets and a chain of its own stores – recorded a 20% increase in sales, pulling in $ 4 billion. Its digital operations alone saw revenue grow 59%
NIKE EXEC FOLLOWED AFTER THE SON’S $ 132,000 TENNIS PURCHASE REPORT
“The NIKE brand momentum is as strong as ever and we are driving growth focused on our biggest opportunities,” said Matt Friend, Nike’s chief financial officer, in a statement. “We continue to see the value of a more direct, digitally enabled strategy, fueling even greater potential for NIKE in the long run.”
Still, the company has its challenges.
North American revenue fell 10% as Nike suffered the same supply chain challenges – from port congestion to container shortages – as other multinational companies. In addition, retail sales in Europe, the Middle East and Africa (EMEA) declined, with approximately 45% of NIKE’s own stores undergoing mandatory COVID-19 closings in the last two months of the quarter. Currently, around 65% of Nike’s EMEA stores are open or operating during reduced hours.
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Overall, Nike reported net income of $ 1.4 billion, or 90 cents per share, compared to $ 847 million, or 53 cents per share, a year ago.
| Ticker | Safety | Last | Change | Change % |
|---|---|---|---|---|
| NKE | NIKE, INC. | 143.17 | -1.65 | -1.14% |
Nike also announced that it would resume stock repurchases after discontinuing its stock buyback program last March to “maximize liquidity during the COVID-19 pandemic.” Prior to the temporary suspension of the share buyback program, a total of 45.2 million shares were repurchased under the program for approximately $ 4 billion.
In the third quarter, Nike paid shareholders $ 434 million in dividends, an increase of 14% over the previous year.
Nike’s shares fell slightly on Thursday’s trading session after the earnings announcement.