Nike Inc. Earnings Cheat Sheet: Profit Rises for Third Straight Quarter

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S&P 500 (NYSE:SPY) component Nike Inc. (NYSE:NKE) reported its results for the second quarter. Nike designs and markets high-quality footwear, apparel, equipment, and accessory products throughout the world.

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Nike Earnings Cheat Sheet for the Second Quarter

Results: Net income for Nike Inc. rose to $469 million ($1 per share) vs. $457 million (94 cents per share) in the same quarter a year earlier. This marks a rise of 3% from the year earlier quarter.

Revenue: Rose 18% to $5.7 billion from the year earlier quarter.

Quoting Management: “Our strong second quarter results demonstrate that the NIKE, Inc. portfolio is a powerful engine for growth,” said Mark Parker, President and CEO, NIKE, Inc. “We’re able to accomplish this by staying focused on what we do best – deliver innovative products and experiences that serve athletes, inspire consumers and reward our shareholders. Going forward we’ll continue to use the unique power of our portfolio to drive growth, manage risk and connect with consumers.”

Key Stats:

The company has now seen net income rise in three straight quarters. In the first quarter, net income rose 15.4% and in the fourth quarter of the last fiscal year, the figure rose 13.8%.

Gross margin shrank 2.9 percentage points to 42.4%. The contraction appeared to be driven by increased costs, which rose 23.9% from the year earlier quarter while revenue rose 17.7%.

Revenue has risen the past four quarters. Revenue increased 17.5% to $6.08 billion in the first quarter. The figure rose 13.6% in the fourth quarter of the last fiscal year from the year earlier and climbed 7.3% in the third quarter of the last fiscal year from the year-ago quarter.

The company has now topped analyst estimates for the last three quarters. It beat the mark by 15 cents in the first quarter and by 8 cents in the fourth quarter of the last fiscal year.

Looking Forward: Analysts appear increasingly negative about the company’s results for the next quarter. The average estimate for the third quarter has moved down from $1.26 a share to $1.25 over the last ninety days. For the fiscal year, the average estimate has moved up from $4.83 a share to $4.99 over the last ninety days.

Competitors to Watch: Crocs, Inc. (NASDAQ:CROX), Deckers Outdoor Corp. (NASDAQ:DECK), Skechers USA, Inc. (NYSE:SKX), K-Swiss Inc. (NASDAQ:KSWS), Steven Madden, Ltd. (NASDAQ:SHOO), The Timberland Company (NYSE:TBL), The Global Housing Group (GLHO), adidas AG (ADDYY), LaCrosse Footwear, Inc. (NASDAQ:BOOT), and Phoenix Footwear Group, Inc. (AMEX:PXG).

Stock Performance: Shares of NKE were up 0.3% from the previous close.

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

 

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