Nike’s Earnings Miss Sends Shares Tumbling 3% After-Hours Before Rebounding

Nike earnings

Shares of Nike Inc (NYSE: NKE) tumbled in after-hours trading Thursday after the athletic-wear giant released its fiscal 2019 fourth quarter earnings report.

The company smashed revenue estimates during the three months ended May 31, thanks in part to higher footwear and apparel sales in its North American and Chinese segments.

Nike, however, missed consensus earnings projections, sending its stock down more than 3% in after-hours trading. Nike shares, which have rallied 12% since the beginning of the year, ended Thursday’s regular session with a gain of 1.38% to change hands at $83.66 apiece.

NKE Earnings & Outlook

Nike had net income of $989 million, or $0.62 per share, compared with net income of $1.14 billion, or $0.69 per share, in the same period a year earlier. Excluding one-time costs and gains, the company earned $0.66 per share during the three months ended May 31.

On average, analysts surveyed were expecting Nike to post adjusted earnings of $0.66 per share, according to data compiled by Refinitiv. Revenue, the company said, jumped to $10.18 billion from $9.79 billion in the same period last year. Analysts had been calling for revenue of $10.16 billion in the quarter, based on Refinitiv figures.

Nike brand brought in revenues of $9.7 billion, while converse generated sales of approximately $491 million in the quarter. Total revenue in the North America region came to $1.70 billion, up 22% from a year ago. North America sales rose 8% to $4.17 billion, excluding currency fluctuations.

NIKE Executive Comments

“FY19 was a pivotal year for NIKE as we continue to bring our Consumer Direct Offense to life throughout the marketplace,” said Mark Parker, Chairman, President and CEO, NIKE, Inc. “Our distinctive innovation and digital advantage led to accelerated growth across our complete portfolio, while our Brand fueled deeper relationships with consumers around the globe.”

“Reflecting on our FY19 performance, it is clear that growth is paramount at NIKE, and that our strong growth is being driven by strategic transformation,” said Andy Campion, Executive Vice President and CFO, NIKE, Inc. “Amid foreign exchange volatility, our double-digit currency-neutral revenue growth and expanding ROIC showcase NIKE’s unrivaled ability to create extraordinary value for consumers and shareholders over the long term.”

Nike Inc Profile

Nike is the largest athletic footwear and apparel brand in the world. It designs, develops, and markets athletic apparel, footwear, equipment, and accessories in six major categories: running, basketball, soccer, training, sportswear, and Jordan Brand. Footwear generates about two thirds of its sales.

Nike’s brands include Nike, Jordan, Converse (casual footwear), and Hurley (action sports). Nike sells products worldwide and outsources its production to more than 400 factories in more than 40 countries. Nike was founded in 1964 is based in Beaverton, Oregon. – Warrior Trading News