Nike Inc Records Strong Online Sales, Beats Estimates
Nike Inc soared on the stock market after it reported a profit for the first quarter after the bell. The firm’s shares soared 13% after trading hours and reached an all-time high of $132 per share.
For the quarter ending August 31, the world’s largest athletic shoe maker’s online sales experienced an unprecedented surge reaching 82%.
In the previous quarter, the firm recorded a 75% increase in online sales. This translates to nearly one-third of the total revenue, beating its prospects set for 2023.
Many Nike outlet stores closed along with the spread of the virus. Since then, the Portland-based manufacturer invested heavily in its online platform.
The firm allocates attention and resources on its website and mobile apps, including online ads, to capture the growing digital market.
As recognized by its chief executive, consumers are now more digitally grounded. Therefore, their investment in digitization is along with its long-term prospects of maintaining its significant position in the shoe and apparel market.
Strong Rebound for Q1
Wall Street analysts predicted earnings of $0.44 per share on revenue of $9.07 billion.
Actual earnings per share for the first quarter stood at $0.95 in an earning of $10.59 billion, topping expectations.
Net income climbed to $1.52 billion from $1.37 billion in the same period last year.
The revenue of $10.59 topped analyst expectation, although this is a modest fall from the $10.66 billion, which was recorded last year.
Along with strong online sales, other heavyweight pullers include demand surge in the Chinese market and the back-to-school period.
Nike Inc. said that sales in China rose by a robust 6%. However, its sales from North America, the firm’s largest market, slipped by 2%.
The report is a breath of fresh air after a sluggish fourth quarter reported at the end of June, where Nike Inc reported an unexpected loss reaching 38% year-on-year due to store closures during the pandemic.
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