Nike, the most valuable fashion brand in the sports business, saw its stock price rising on Tuesday, as the company reported an 82% surge in online sales and offered an impressive outlook that calls for demand to grow through the holidays.
Nike has used the COVID-19 pandemic as leverage to expand its digital business, and its women’s apparel division grew by nearly 200%. Parents stocked up on back-to-school items, and its business picked up in key markets like China.
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Highlights of the results
First-quarter reported revenues were $10.6 billion, down 1 percent on a reported basis, and flat to the prior year on a currency-neutral basis.
Nike’s direct sales were $3.7 billion, up 12 percent on a reported basis, and up 13 percent on a currency-neutral basis, with growth across all geographies.
Brand digital sales increased 82 percent, or 83 percent on a currency-neutral basis, with double-digit increases across North America, Greater China, and APLA and triple-digit growth in EMEA.
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Diluted earnings per share for the quarter was $0.95, up 10 percent. Inventory rose 15 percent versus the prior year, but decreased 9 percent versus the prior quarter.
“Our results this quarter continue to demonstrate NIKE’s full competitive advantage, as we strengthen our position in the midst of disruption,” said John Donahoe, President, and CEO, Nike, Inc.
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“In this dynamic environment, no one can match our pace of launching innovative products and our Brand’s deep connection to consumers. These strengths, coupled with our digital acceleration, are unlocking NIKE’s long-term market potential.”
COVID-19 pandemic is also helping Nike’s digital potential. The company disclosed that its digital sales now make up at least 30% of its total quarterly sales, a threshold that Nike had previously aimed to hit in three years’ time.
“Nike is recovering faster based on accelerating brand momentum and digital growth,” CFO Matt Friend stated on Tuesday.
Full details of the results can be found here