Nike Inc. saw revenues and profits rise during the third quarter, thanks to increased consumer demand globally.
The athletic giant posted a 5 percent increase in net revenue to $8.4 billion for the quarter ended Feb. 28, driven by double-digit sales growth in Western Europe, China and other emerging markets, as well as the popularity of its sportswear and Michael Jordan brand categories.
Nike’s net income also increased by 20 percent to $1.1 billion for the quarter and diluted earnings per share increased 24 percent to $0.68, due in large part to selling and administrative expense leverage and a lower effective tax rate, according to the company.
During the third quarter, Nike also repurchased nearly nine million shares for about $475 million.
Nike president and chief executive officer Mark Parker said the positive quarterly results were thanks to the brand’s “diverse global portfolio” and said Nike plans to “sustain positive momentum,” during a call with analysts.
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Parker admitted that consumer shopping habits have changed “especially in North America,” including a significant shift to digital shopping, but said Nike plans to continue its “relentless flow of innovation” in several areas of the company.
As part of what Nike is calling its “triple double,” the company intends to double the “cadence and scale” of its performance and sports styles, double the speed of its product creation cycle to a time frame to get new products to market “in weeks, not months,” as well has offering fewer products overall.
Parker pointed out that, at the moment, about 75 percent of Nike styles make up nearly all of the company’s sales, so cutting that underperforming 25 percent of merchandise will “amplify the productivity of both new innovations and the products consumers already love, while driving more growth and choice from fewer styles.”
Nike is also planning to expand its Nike+ personal shopping service to more stores and wholesalers. The program is available in larger markets like New York, and includes a membership program, invitations to training clubs as well as opportunities for customers to try the newest products.
Parker said Nike+ members who take part in personal shopping buy three times as much on average.
“The more directly Nike engages with the consumer, the greater the return,” Parker added. “More personal, more mobile, more distinctive — these are the dimensions that will drive growth. I’m convinced that now is the time to rewrite the playbook of retail.”