Nike Remains Challenged in the US
The company has said it would improve results in its largest market by selling to fewer retailers and doing more business with chains that focus on athletic gear.
BEAVERTON, United States — Nike Inc. is still struggling in North America, even as it makes gains in most other regions.
The world’s largest sports brand posted quarterly sales that fell short of estimates in its home market, while beating them in Greater China and Europe, the Middle East and Africa. Nike shares alternated between losses and gains in late trading.
The results show that Nike still faces a challenge in regaining its footing in the U.S., where several retail partners have faltered and rival Adidas has been taking market share. The company succeeded, however, in beating estimates for revenue and has downplayed concerns over its North America results.
Chief Executive Officer Mark Parker said there was “underlying momentum” in the company’s domestic business during the quarter ending Nov. 30, and said the lineup of new products for the next six months is “as strong as it’s ever been.”
One bright spot is that Nike’s gross margin narrowed less than expected, even though several of its retail partners have reported a very promotional shopping environment.
The decline in North America marked the second straight. The company has said it would improve results in its largest market by selling to fewer retailers, and instead do more business with chains, like Foot Locker Inc., that focus on athletic gear.
Profit was 46 cents a share, beating the average analyst estimate of 40 cents, while revenue of $8.55 billion outpaced the estimate of $8.39 billion. Gross margins were 43 percent, compared with the expected 42.5 percent.
By Matt Townsend; Editors: Nick Turner, Jonathan Roeder.