Business news :Nike Q1 earnings drop 12%, but still manages to beat forecasts
Even after beating analyst expectations, the news of a decline in orders sent Nike shares down 3 per cent after market close on Thursday.
According to Reuters, futures orders of Nike-branded shoes and clothes for September 2012 to January 2013 rose 6 per cent. However, in Nike’s all-important Chinese market, it was a different story. Futures plummeted from a 27 per cent high in growth last year to a 5 per cent decline, a result investors did not take to kindly.
"The (Chinese) consumer is becoming more discerning and sophisticated. At the same time the economy seems to be slowing, creating short-time challenges for retailers," Charlie Denson, president for the Nike brand, said in light of the results.
"It's a natural evolution we've seen in many markets, so we're not surprised," he said.
In spite of the fall, Nike’s results for the first quarter fared well against a tumultuous economic backdrop. The sportswear giant earned USD 1.23 a share for the quarter to 31 August, compared to USD 1.36 a share the year before. However, the average analyst forecast from Thomson Reuters I/B/E/S came in at USD 1.12 a share.
Similarly, Nike revenue rose 10 per cent to USD 6.7 billion, compared with estimates of USD 6.42 billion.
( source myretailmedia.com )