August 19, 2022

Demand for Nike Brand Helps It in Fourth Quarter

Futures orders gained 12 percent, excluding currency fluctuations.

Nike’s net income in the fiscal fourth quarter, which ended May 31, rose 14 percent to $594 million, or $1.24 a share. Net income for the year ago period was $522 million, or $1.06 a share.

Nike was expected to earn $1.16 a share, according to the average estimate of analysts surveyed by Thomson Reuters.

Revenue for the quarter rose 14 percent, to $5.8 billion from $5.08 billion. Excluding currency movements, revenue climbed 11 percent.

Nike was expected to generate $5.528 billion in revenue in the period, according to a Thomson Reuters analyst poll.

Apparel retailers are struggling with higher material, labor and freight costs. But Nike was able to fend off such pressure because demand for its brand was so strong during the quarter, according to Matt Arnold, an analyst at Edward Jones.

“The best way to offset higher costs is to generate strong demand growth, and Nike was able to do that,” Mr. Arnold said.

Futures orders, excluding currency exchange rates — a closely watched measure of sales growth — came in ahead of Wall Street estimates. Orders for June through November increased 15 percent to $10.3 billion. Excluding currency effects, orders rose 12 percent, Nike said.

Robert Drbul, an analyst at Barclays Capital, expected futures orders to be up 8 to 10 percent.

Mr. Arnold, the analyst at Edward Jones, was expecting future orders to be up at least 8 percent. Strong futures orders suggest Nike will be able to raise prices later this year, he added.

Shares of Nike rose 4.5 percent, to $85.25 in after-hours trading.

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