China Sales Lift Nike's Results -- WSJ
Source: Dow Jones News
By Kimberly Chin and Khadeeja Safdar
This article is being republished as part of our daily reproduction of WSJ.com articles that also appeared in the U.S. print edition of The Wall Street Journal (September 25, 2019).
Sales at Nike Inc. jumped 7% in the latest quarter, boosted by large sales gains in China and showing the region's strength as a growth driver despite trade tensions with the U.S.
Nike's Greater China revenue climbed 22% to $1.68 billion. The company, which doesn't own factories, produces about 25% of its global apparel and footwear in China.
On Tuesday, Chief Executive Mark Parker said the company has experienced double-digit-percentage growth in the region every quarter for more than five years. "Nike is a brand of China for China and the results continue to prove it out," he said on a call with analysts.
Meanwhile, revenue in Nike's North American market, which accounts for the majority of total sales, rose roughly 4% to $4.29 billion. Overall sales increased to $10.66 billion from $9.95 billion a year earlier and exceeded analysts' estimates of $10.44 billion for the quarter ended Aug. 31.
Mr. Parker said the company's international and digital businesses grew 16% and 42% respectively, and its women's business was helped by sporting events over the summer, such as the Women's World Cup soccer tournament.
Nike has been investing heavily in its apps, including its main shopping app and a SNKRS app, just for selling sneakers. Mr. Parker said the company has more than doubled its users across all of its apps over the past three years.
Shares of Nike, which have gained 18% this year, rose more than 5% in after-hours trading.
The Beaverton, Ore.-based company's profit was $1.37 billion, or 86 cents a share, up 25% from a year earlier. Analysts were expecting per-share earnings of 71 cents, according to FactSet.
Selling and administrative expense increased 9% for the quarter.
Write to Kimberly Chin at kimberly.chin@wsj.com and Khadeeja Safdar at khadeeja.safdar@wsj.com
