Nike released its third quarter earnings after
yesterday's close of trading, and CNBC's Stock Editor
Patrick Bolland reported that Nike's revenue was down 1% to
$2.16B, while net income was up 17% to $145M. In "extended
hours," Nike stock was up 2 1/8 to close at 36 ("The Edge,"
CNBC, 3/16). CNBC's Maria Bartiromo reported that Nike
earned $.52 a share, which topped analysts' $.50 estimate
and was $.08 better than a year ago. Gross margins were
also up from 37% to 47% (CNBC, 3/16). A WALL STREET JOURNAL
report writes that Nike "said it was able to increase profit
by reducing its effective tax rate and recording its highest
gross margins in three years." Nike's world-wide futures
orders for March-July, total $3.9B, an increase of 4% from
the same period last year (WALL STREET JOURNAL, 3/17).
REAX: CNBC's Bolland said, "The knee- jerk reaction is
that this is good news. They beat the expectations, but
don't forget, these were reduced expectations because about
a month ago, they warned [that earnings would be off]"
(CNBC, 3/16). CNBC's Sharon Epperson: "As Nike CEO Phil
Knight said just moments ago on the conference call, 'The
rebound continues.' Nike stock had been under some pressure
lately, but the company also has a history of beating Wall
Street's numbers for the past couple of quarters, and this
time, gross margins really helped to power Nike's earnings
surprise. ... Nike executives said improvement in apparel
and equipment margins helped the overall number, as well as
closeouts, as retail outlets helped reduce inventory.
[Nike] said these margins can be maintained in future
quarters" (CNBC, 3/16).
