Jordan Brand's sales benefited from a spike in interest among women and in markets outside the U.S.nike
Nike reported quarterly sales and earnings "ahead of Wall Street expectations as it continues to deliver on a business plan that revolves around direct sales and getting products to market quicker," according to Matthew Kish of the PORTLAND BUSINESS JOURNAL. The company said that sales climbed 10% in the quarter ended Nov. 30 to $10.3B, ahead of the $10.09B "expected by analysts." Nike also reported $0.70 in earnings per share, "ahead of the $0.58 expected." Sales "climbed in each of the company's four sales geographies." Outgoing Nike Chair, President & CEO Mark Parker said that the company's "digital sales were up" 38% in the most recent quarter. On Black Friday, Nike's digital sales in North America increased 70% from the same day a year ago. But despite "beating on sales and earnings, the company's stock dipped slightly in after-hours trading, likely the result of North American sales coming in just under analyst expectations" (BIZJOURNALS.com, 12/19). Nike execs said that apparel sales "were flat in North America because of the boost that business got a year earlier," when LeBron James joined the Lakers, "lifting sales of his jerseys" (WALL STREET JOURNAL, 12/20). Meanwhile, Nike said that its Jordan Brand had its "first ever billion-dollar quarter, thanks to new innovation and a spike in interest in the basketball-focused label, including among women and in markets outside the U.S." (CNBC.com, 12/19). At presstime, shares of Nike were trading at $99.28, down 1.85% from the close of business on Thursday (THE DAILY).
GLOBAL LOOK: Morningstar Analyst David Swartz said Nike "had some one-time issues in the quarter" in regards to the Chinese market, "including tariffs and possibly the demonstrations in Hong Kong and other issues in China that may have had a small impact on the gross margin but in the long-term it's really immaterial" ("Closing Bell," CNBC, 12/19). CNBC contributor Dan Nathan said the 23% growth "in a region like China given all the headwinds that we've had over the last few months" is good, especially considering the issue with the NBA and Rockets GM Daryl Morey's tweets, and the recent comments from Arsenal MF Mesut Ozil. Nathan: "So to do 23% in China, that's great and it's only be gravy from here on out" ("Fast Money," CNBC, 12/19). Raymond James Managing Dir Matthew McClintock said he has not "been that concerned" with the trade war between China and the U.S., and this quarter "is a perfect example of why I shouldn't be that concerned about it" ("Squawk Box," CNBC, 12/20).
