“We continue to see consumer demand for our brands and for our products to be very, very strong,” CFO Matthew Friend confirmed to investors, affirming his belief that consumers will remain resilient. Furthermore, the company expects sales to rise during the upcoming holiday shopping season.

Nike shares rose by over 6% on Friday following the positive assessment. Barclays consumer discretionary senior analyst Adrienne Yih feels that while consumers may disregard certain brands when their spending power is limited, they will continue to show loyalty to their favorite brands. “their favorite brand they continue to spend at,” Yih observed, adding that “I think that’s what you’re seeing with the power of Nike being the No. 1 brand both domestically and globally.”

The post Nike Earnings Show Retailer’s Resilience Despite Consumer Slowdown appeared first on theprimarymarket.com.

The sportswear giant has faced excessive inventory levels this year on the back of lower US demand. This issue largely stems from supply-chain hiccups as well as lower discretionary spending from consumers. Nike shares have plummeted by around 23% so far this year.

The company’s inventory levels stood at $8.7 billion during the first quarter, down from $9.66 billion a year earlier. Nike is adding a 100 basis point boost to its current-quarter gross margin forecast while keeping its annual outlook constant.

Drake MacFarlane, research analyst at M Science, has praised Nike’s ability to shrink its inventory, commenting that it “is very encouraging, considering the overall challenging promotional environment for the footwear industry.”

The post Nike Shares Surge Following Inventory Cut appeared first on theprimarymarket.com.

Analysts largely cut their price targets on Nike shares in recent weeks after several wholesalers of the athletic apparel brand warned of a downturn in consumer spending.

Bloomberg consensus estimates have Nike earning revenue of $12.59 billion for the quarter. Adjusted earnings per share are expected to be $0.67, bringing the gross margin estimate to 43.5%.

Nike has been building a growth strategy based on its direct-to-consumer business. The company saw a 17% rise in revenue from the previous year last quarter, with direct-to-consumer revenue comprising 42% of its total revenue during the period.

Still, the company continues to expand its wholesale partnerships, with reports earlier this month that the company’s products will return to DSW and Macy’s.

“Investors are worried that this is a reversal in Nike’s shift from wholesale to DTC, but we don’t think the strategy is broken,” a Bank of America research analyst observed. “We expect to hear an explanation of these moves on the conf call rather than an about-face on its focus on reducing undifferentiated wholesale.”

The post Nike Stock Declines Ahead of Q4 Earnings Report appeared first on theprimarymarket.com.

“We believe the inventory peak is behind us,” CEO John Donahoe said of the company’s battle with eliminating excess inventory. “The actions we’re taking in the marketplace are working.”

Although still facing a $9.3 billion inventory issue which has resulted in smaller gross margins than the same period last year, the sports apparel company released favorable fiscal results. Nike’s second-quarter revenue hit $13.32 billion, thereby exceeding analysts’ estimates of $12.6 billion. Its reported adjusted earnings of $0.85 per share exceeded forecasts of $0.65 per share.

During Tuesday’s quarterly earnings call, Nike executives commented that the company’s struggles to beat back its inventory struggles are largely due to “unfavorable changes” in exchange rates as well as rising freight and logistics costs.

The company’s sales growth was largely driven by direct-to-consumer sales, which grew by 16% on a year-over-year basis. Standing at $5.4 billion, direct-to-consumer sales for the quarter fell about $25 million short of analysts’ estimates.

The post Nike Stock Rises as Sales Surge appeared first on theprimarymarket.com.

Nike reported $12.69 billion in net sales compared to $12.31 billion expected while also coming at $0.93 in earnings per share versus $0.92 estimated by Wall Street experts. However, despite the positives, the company’s earnings revealed quite a few negatives.

The biggest concern for the investors was Nike’s ballooned inventory caused by cautious consumers and economic slowdown. The company’s inventories are up 65 percent in North America and 44 percent up year-over-year.

Also, it didn’t help that Nike saw a big drop in gross profit margins and missed out on Wall Street estimates. The sportswear and footwear giant reported a 44.3 percent gross profit margin compared to the 45.4 percent expected.

However, despite these red flags, Nike remains confident about a positive outlook for the closing period of the year. 

“We plan to compete… in a more promotional environment,” Nike CFO Matt Friend said on Thursday. “And given the macro uncertainty that’s out there for the consumer, we’re taking a more measured approach, and we’re tightening our inventory buys around the world based on some of the risks that could materialize in the second half.”

The post Nike Stock Takes 13% Dive Amid Ballooned Inventory appeared first on theprimarymarket.com.

“We continue to see consumer demand for our brands and for our products to be very, very strong,” CFO Matthew Friend confirmed to investors, affirming his belief that consumers will remain resilient. Furthermore, the company expects sales to rise during the upcoming holiday shopping season.

Nike shares rose by over 6% on Friday following the positive assessment. Barclays consumer discretionary senior analyst Adrienne Yih feels that while consumers may disregard certain brands when their spending power is limited, they will continue to show loyalty to their favorite brands. “their favorite brand they continue to spend at,” Yih observed, adding that “I think that’s what you’re seeing with the power of Nike being the No. 1 brand both domestically and globally.”

The post Nike Earnings Show Retailer’s Resilience Despite Consumer Slowdown appeared first on theprimarymarket.com.

The sportswear giant has faced excessive inventory levels this year on the back of lower US demand. This issue largely stems from supply-chain hiccups as well as lower discretionary spending from consumers. Nike shares have plummeted by around 23% so far this year.

The company’s inventory levels stood at $8.7 billion during the first quarter, down from $9.66 billion a year earlier. Nike is adding a 100 basis point boost to its current-quarter gross margin forecast while keeping its annual outlook constant.

Drake MacFarlane, research analyst at M Science, has praised Nike’s ability to shrink its inventory, commenting that it “is very encouraging, considering the overall challenging promotional environment for the footwear industry.”

The post Nike Shares Surge Following Inventory Cut appeared first on theprimarymarket.com.

Analysts largely cut their price targets on Nike shares in recent weeks after several wholesalers of the athletic apparel brand warned of a downturn in consumer spending.

Bloomberg consensus estimates have Nike earning revenue of $12.59 billion for the quarter. Adjusted earnings per share are expected to be $0.67, bringing the gross margin estimate to 43.5%.

Nike has been building a growth strategy based on its direct-to-consumer business. The company saw a 17% rise in revenue from the previous year last quarter, with direct-to-consumer revenue comprising 42% of its total revenue during the period.

Still, the company continues to expand its wholesale partnerships, with reports earlier this month that the company’s products will return to DSW and Macy’s.

“Investors are worried that this is a reversal in Nike’s shift from wholesale to DTC, but we don’t think the strategy is broken,” a Bank of America research analyst observed. “We expect to hear an explanation of these moves on the conf call rather than an about-face on its focus on reducing undifferentiated wholesale.”

The post Nike Stock Declines Ahead of Q4 Earnings Report appeared first on theprimarymarket.com.

“We believe the inventory peak is behind us,” CEO John Donahoe said of the company’s battle with eliminating excess inventory. “The actions we’re taking in the marketplace are working.”

Although still facing a $9.3 billion inventory issue which has resulted in smaller gross margins than the same period last year, the sports apparel company released favorable fiscal results. Nike’s second-quarter revenue hit $13.32 billion, thereby exceeding analysts’ estimates of $12.6 billion. Its reported adjusted earnings of $0.85 per share exceeded forecasts of $0.65 per share.

During Tuesday’s quarterly earnings call, Nike executives commented that the company’s struggles to beat back its inventory struggles are largely due to “unfavorable changes” in exchange rates as well as rising freight and logistics costs.

The company’s sales growth was largely driven by direct-to-consumer sales, which grew by 16% on a year-over-year basis. Standing at $5.4 billion, direct-to-consumer sales for the quarter fell about $25 million short of analysts’ estimates.

The post Nike Stock Rises as Sales Surge appeared first on theprimarymarket.com.

Nike reported $12.69 billion in net sales compared to $12.31 billion expected while also coming at $0.93 in earnings per share versus $0.92 estimated by Wall Street experts. However, despite the positives, the company’s earnings revealed quite a few negatives.

The biggest concern for the investors was Nike’s ballooned inventory caused by cautious consumers and economic slowdown. The company’s inventories are up 65 percent in North America and 44 percent up year-over-year.

Also, it didn’t help that Nike saw a big drop in gross profit margins and missed out on Wall Street estimates. The sportswear and footwear giant reported a 44.3 percent gross profit margin compared to the 45.4 percent expected.

However, despite these red flags, Nike remains confident about a positive outlook for the closing period of the year. 

“We plan to compete… in a more promotional environment,” Nike CFO Matt Friend said on Thursday. “And given the macro uncertainty that’s out there for the consumer, we’re taking a more measured approach, and we’re tightening our inventory buys around the world based on some of the risks that could materialize in the second half.”

The post Nike Stock Takes 13% Dive Amid Ballooned Inventory appeared first on theprimarymarket.com.