Solid sales for Nike in the US and Europe helped offset pandemic-related challenges in China and Asia-Pacific during the second quarter and underpinned a forecast-beating result for the sportswear maker.
Nike on Monday said it continued to manage the impact of supply chain disruptions across the marketplace, but chief executive John Donahoe said the company was, overall, “in a much stronger competitive position today than we were 18 months ago”.
Those supply chain disruptions were most notable in Asia, with the US-based company reporting that revenues in China and the Asia-Pacific and Latin America regions declined “largely due to lower levels of available inventory resulting from Covid-19 related factory closures”.
Although those closures had adverse effects across the company’s entire portfolio, management said North America and Europe, the Middle East and Africa experienced growth because of “higher levels of in-transit inventory entering the second quarter”.
Three months ago, Nike talked up the “steady normalisation” of physical retail as pandemic-era restrictions eased, but this was before the latest wave of measures a growing number of countries have taken in recent weeks to stem the spread of the Omicron variant of coronavirus.
Overall, Nike reported revenues of almost $11.36bn in the three months ended November 30. That was up 1 per cent from a year ago, without accounting for currency fluctuations, but came in about $100m ahead of what analysts forecast in a Refinitiv survey.
Net income of $1.34bn, up 7 per cent from a year ago, topped Wall Street’s median forecast of $1.01bn.
Sales at Nike’s direct to consumer channel rose 8 per cent from a year ago during the second quarter. That was led by North America, where the company said it had record sales for Nike Direct during the Black Friday week around the US Thanksgiving holiday.
Nike shares were up 4.8 per cent in after-hours trading on Monday.
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