Global sports gear titan Nike reported solid revenue growth and beat analyst earnings forecasts for its fiscal first quarter on Tuesday, despite a cost surge tied to the Brazil Olympics. Nike reported revenues for the quarter ended August 31 up 7.7 percent from a year ago to $9.1 billion, around $200 million higher than expected.
Earnings per share, bolstered by share buybacks, came in at 73 cents, compared to 67 cents a year ago and well past the 56 cents analysts had predicted. "Fueled by an incredible summer of sport, Nike delivered strong global growth and led the industry through disruptive innovation," said Mike Parker, Nike chairman, president and chief executive.
The company got some sales help from the Olympics, but also saw marketing costs rise significantly during the same period as it heavily promoted its brand during the Rio games. it also got a significant boost from a one-time tax benefit that cut its overall tax bill for the quarter to 2.5 percent from 18.4 percent a year ago.
After a six percent gain in North America revenues in the first quarter, future orders in its primary were up just one percent, Nike reported. Inventories at the end of August were up 11 percent.
After several years dominating the global sports shoes and equipment market, Nike has found itself fending off tough challenges from Adidas, Puma and Under Armour.
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