Revenues from continuing operations grew 7.4 percent, to $5.96 billion from $5.55 billion, and were up 10 percent on a constant currency basis. Nike’s closely watched futures-orders metric stood at $9.3 billion, up 6 percent.
Gross margin contracted 30 basis points to 42.5 percent of sales, as favorable pricing and raw-material costs were offset by higher labor costs and currency fluctuation.
Shares advanced $1.22, or 1.3 percent, to $99 during the trading day and rose another $5.15, or 5.2 percent, to $104.15 following the disclosure of results.
The Nike brand’s footwear and apparel businesses registered similar sales increases, with footwear up 6.7 percent to $3.3 billion and apparel ahead 7.2 percent to $1.8 billion. North America, the brand’s biggest market, generated the largest increases in both sales and profitability, with sales expanding 17.2 percent to $2.42 billion and operating income moving up 30.5 percent to $556 million.
Mark Parker, president and chief executive officer, told participants on an early evening conference call, “In North America we created great momentum. This is somewhat counterintuitive to some, given this market’s size and assumed maturity. But I see tremendous growth opportunity in North America fueled by continued success in transforming the marketplace along category lines.”
Charlie Denson, president of the Nike brand, cited double-digit growth in running, basketball and men’s training for the successful North American performance. Also contributing to the strong showing was Nike’s launch of National Football League merchandise. “We delivered a new level of performance and style for every player in the NFL,” he said.
In China, the only market to experience sales or profit declines, sales pulled back 11.2 percent, to $577 million, while operating income slid 15.9 percent to $185 million. Donald Blair, chief financial officer, said on the company call that gross margin in China improved “as the impact to clean up the [distribution in the] market was more than offset by the benefits of higher prices and easing raw-material costs.” He noted other positive signs in China — including lower inventory levels, improving comparable-store sales and higher apparel sell-throughs — as the company works to better tailor its assortments and marketing to the Chinese market.
“That said, we still expect lower revenue and [earnings before interest and taxes] from this geography over the next few quarters as we work to position our business to realize [its] tremendous growth potential,” Blair said.
For the first half of the year, net income, including discontinued operations and associated costs, fell 14.6 percent to $951 million, or $2.07 a diluted share, as revenues rose 8.7 percent to $12.43 billion. The discontinued Umbro and Cole Haan operations are excluded from revenue figures.
“Azzedine has been one of the biggest influences in my life. He has always been such a strong, loving, fatherly figure to me. I call him Papa. His designs are indescribably unique, they are pieces of art. He knew how to make the female form look its loveliest. I have so many memories of him; my favorite might be during my first show with him in Paris. He liked me and he wanted to help me get more work. He called all his friends at Kenzo and Comme des Garcons, and asked them to book me. They said, ‘But she can’t walk!’ And he said, ‘but she has such a great ass!' His friendship and support has been the great privilege of my career. I can't imagine life without him. Repose en paix mon Papa.” - @stephanieseymour tells @wwd. #wwdfashion (📷: @steveeichner) #alaia #azzedinealaia
Azzedine Alaïa, flanked by two of his closest friends, models Stephanie Seymour and Naomi Campbell.
He designed Seymour’s dress for her 1995 wedding to Peter Brant, and treated Campbell (who famously called him Papa), like a daughter. For more on the legendary designer, tap the link in bio. #wwdfashion #alaia #azzedinealaia
Azzedine Alaïa's “I-did-it-my-way” ethos stood out starkly at a time when brands are experimenting with consumer-facing fashion shows, coed formats and trans-seasonal collections – anything to perk up lackluster sales of ready-to-wear in an age of Insta-everything. “It’s not creation anymore. This becomes a purely industrial approach,” the late designer told WWD in an interview last year. “But anyway, the rhythm of collections is so stupid. It’s unsustainable. There are too many collections.” Read more about the iconic designer’s life and work on wwd.com, link in bio. #wwdfashion #azzedinealaia (📷: @WWD Archive, 1986) #alaia
Sneaker reselling app @goat’s latest exhibit, "The Greatest: New York," tells the story of New York's sneaker culture. To celebrate the exhibit, an intimate crowd gathered on Thursday night at the pop-up gallery space, located at Platform in Culver City, to hear guest speaker and illustrator @esymai talk about her own rise in streetwear and women in the business. "For me I'm just someone who is creative. I like to create things," said Chang. #wwdfashion
Azzedine Alaïa, one of the most iconic couturiers of the modern era whose body-con designs defined Eighties fashion, has died in Paris. The diminutive Tunisian-born designer, known for his structured knitted dresses with fitted waists and impeccably cut, figure-hugging second skin silhouettes was deeply admired by his peers, and counted supermodel Naomi Campbell - his adoptive daughter - among his inner circle, one of a gang of glamazons including Farida Khelfa, Carla Bruni and Stephanie Seymour who became ambassadors of his style. (📷: Alexandre Guirkinger) #wwdblast