Nike sales rise, but supply chain issues and inventories weigh on earnings

Nike connected Thursday said it had a beardown archetypal fiscal 4th contempt proviso concatenation issues, arsenic good arsenic declining income successful Greater China, its 3rd biggest marketplace by revenue.

Like different retailers, Nike has been facing proviso concatenation headwinds, specified arsenic a emergence successful some shipping costs and shipping times successful caller quarters. The institution said its inventory levels swelled during the 4th compared to the year-ago period.

The company's shares dropped astir 5% successful after-hours trading.

Here's however Nike did successful its archetypal fiscal 4th compared with what Wall Street was anticipating, based connected a survey of analysts by Refinitiv:

• Earnings per share: 93 cents vs. 92 cents expected
• Revenue: $12.69 cardinal vs. $12.27 cardinal expected

Nike reported nett income for the three-month play ended Aug. 31 fell 22% to $1.5 billion, oregon 93 cents per share, compared with $1.87 billion, oregon $1.18 per share, a twelvemonth earlier.

Revenue during the play was up 4% to $12.7 billion, compared with $12.2 cardinal a twelvemonth earlier.

Recently, Nike has been shifting its strategy and looking to merchantability its sneakers and different merchandise straight to customers and standard backmost connected what is sold by wholesale partners similar Foot Locker. The institution said connected Thursday its nonstop income grew by 8% to $5.1 billion, and income for its digital-brand roseate 16%. On the flip side, income for Nike's wholesale concern income accrued by 1%.

In its archetypal fiscal quarter, Nike said its inventory roseate 44% to $9.7 cardinal connected its equilibrium expanse from the aforesaid play past year, which the institution said was driven by proviso concatenation issues and partially offset by beardown user demand.

Total income successful Greater China were down 16% to astir $1.7 billion, compared with astir $2 cardinal a twelvemonth earlier. The institution has faced disruption successful its concern successful the region, wherever Covid lockdowns person affected its business. Nike had said successful the erstwhile 4th it expected issues successful Greater China to measurement connected its business.

Meanwhile, full income successful North America, Nike's largest market, accrued 13% to $5.5 cardinal successful the archetypal fiscal quarter, compared with astir $4.9 cardinal successful the aforesaid play past year. The sneaker elephantine has continuously said user demand, particularly successful the U.S. market, hasn't waned contempt inflation.

Read the company's net merchandise here.

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