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.
@chanel and @pharrell dropped what’s being dubbed as the world’s most exclusive sneakers yesterday. The Adidas Originals NMD Hu, which Williams designed in collaboration with Chanel and @adidasoriginals, has a waiting list of over 120K people who pre-registered online at chanelatcolette.fr –– and only 500 pairs are on sale. The singer predicted the resale value of the shoes could reach $40K. Read the full interview on WWD.com. Link in bio. #wwdfashion (📷: Dominique Maître)
@imanshumpert is diving deeper into his creative endeavors and relaunching his clothing line, Post 90s, and is helping to raise money for the hurricane victims in St. Maarten with a jersey he’s designed with his brother. The Cleveland Cavaliers player talked to WWD about kneeling during the national anthem, working with fashion brands and how he wants to be more than an @nba player. Read the interview on WWD.com #wwdfashion (📷: George Chinese)
Not only does #TheProfit return to CNBC tonight, but @marcuslemonis has launched @shopmarcus, a new shopping and lifestyle retail experience in Aspen and Chicago, with more locations to come. The retail stores offer in-store stylists and a variety of contemporary womenswear selections.
“It’s life, I’m going to face it,” @mingxi11 sighed. “I fell, but you know, I think the most important thing is that I get back up. I had the love, the help from my sister — the girl next to me Gizele [Oliveira] — she’s so nice. When I went backstage everybody was trying to comfort me like ‘Oh Ming, it’s OK.’ I’m really, really touched. I think it’s them who gave me the courage to go back on stage for the finale,” Xi told WWD of her fall at the @victoriassecret fashion show. (📷: David Fisher) #wwdfashion #vsfashionshow #victoriassecret
@louisvuitton tapped @therealpeterlindbergh for its latest city-centric photo book, which is part of a series called Fashion Eye. The primarily black and white book captures the spirit of Berlin in 57 images shot between 1989 and 2019. “Berlin is an inspiration for me, more than a city. I mean @millajovovich is simply Berlin!” said Lindbergh. #wwdfashion
“You know, I think audiences expect a certain performance so I have to deliver to them what they’re expecting to a certain degree. But I’m also a different actor and a different person, I have my own spin on the character,” says @noahegalvin of his takeover of the leading role in “Dear Evan Hansen” following the departure of @bensplatt, who originated the role. Read WWD’s interview with the 23-year-old actor on WWD.com #wwdeye (📷: @jilliansollazzo)
For pre-fall 2018, @etro created richly-colored wonderland, using tapestries, textiles and wallpapers from the Eastern world at large. The line featured floral and graphic prints and jacquard motifs, like this two-piece look featured here. #wwdfashion (📷: Giovanna Pavesi)
@kith is moving into children’s. The men’s and women’s streetwear brand has launched Kidset, a Kith kids line located in New York at 64 Bleecker Street. The line includes mini versions of staple Kith pieces like the Astor bomber jacket and the Kith box logo sweatshirts, along with a wall that can display up to 120 pairs of shoes from @adidas, @newbalance, @timberland and more. #wwdfashion
“I just wanted to create this fully rounded character, but I do think what excited me most was just the opportunity to give a group of people representation that I feel needs it. I like to do characters in projects that stand for something and Karolina definitely does, so that was really exciting to me,” @ginnygardner says of her new role in @hulu’s “The Runaways.” Gardner plays Karolina Dean, a queer superhero, which is a rarity for @marvel. Read more about Gardner’s character on WWD.com #wwdeye (📷: @dandoperalski)