Nike Q3 income dips as sales run high, Asia disappoints
Global sportswear giant Nike Inc. said on Monday total revenues came close to $11 billion in the third quarter fiscal 2022, as the U.S firm saw a steady return to normal footfall levels across its owned stores across the globe.
The Portland, Oregon-based Nike said quarterly revenues reached $10.9 billion, up 5% compared to prior year and up 8% on a currency-neutral basis.
Nike direct sales surged to $4.6 billion, up 15% on a reported basis and up 17% on a currency-neutral basis, as the steady normalization of traffic in owned physical retail stores returned, with Nike-owned store sales up 14%.
Wholesale revenues declined 1% on a reported basis and were up 1% on a currency-neutral basis, with growth in EMEA and APLA offset by declines in North America and Greater China.
Nike brand digital sales increased 19%, or 22 percent on a currency-neutral basis, led by 33% growth in North America, EMEA and APLA, offsetting declines in Greater China.
Revenues for the Nike brand totalled $10.3 billion, up 8% compared to prior year on a currency-neutral basis, led by 13% growth in EMEA. Revenues for Converse were $567 million, up 2% on a currency-neutral basis, led by strong performance in North America and Europe, partially offset by declines in Asia.
"Nike’s strong results this quarter show that our 'Consumer Direct Acceleration' strategy is working, as we invest to achieve our growth opportunities," said John Donahoe, president and CEO, Nike Inc.
"Fueled by deep consumer connections, compelling product innovation and an expanding digital advantage, we have the right playbook to navigate volatility and create value through our relentless drive to serve the future of sport."
Nike's net income for the three months ending February 28 fell 4% to $1.4 billion, while diluted earnings per share were $0.87.
Profits were hindered by demand creation expense, which totalled $854 million, up 20%, primarily due to brand campaign expenditure and continued investments in digital marketing to support digital demand. Operating overhead expenses also increased 11% to $2.6 billion, primarily due to strategic technology investments and wage-related expenses, the company said.
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