Mar 21, 2014
Nike futures orders soar ahead of World Cup
Mar 21, 2014
Nike said that global orders for its merchandise soared heading into the World Cup soccer championship in Brazil this summer, sending shares up nearly 2 percent.
The maker of sports gear also reported a better-than-expected quarterly profit, helped by rising sales in China and an enormous jump in revenue in Western Europe, where it competes with Adidas.
Orders for Nike-branded shoes and clothing scheduled for delivery between March and July 2014, a gauge of demand Nike calls "futures orders," rose 14 percent globally, excluding the impact of currency fluctuations, including a 30 percent jump in Western Europe.
Nike has been spending heavily on marketing ahead of the World Cup, which takes place in June and July in Brazil.
Total revenue rose 12.7 percent to $6.97 billion for the quarter ended February 28, above the $6.69 billion analysts were expecting, according to Thomson Reuters I/B/E/S.
In China, where Nike has grappled with the lingering effects of excess inventory and intense competition from rivals cutting prices in recent years, sales rose 7 percent.
"They continue to produce items that resonate with shoppers globally," said Edward Jones analyst Brian Yarbrough. "They're gaining share in each of their markets."
Still, he said, a 9 percent gain in futures orders in North America was lower than typical, and a 3 percent decline in China in that metric showed that the company still faces challenges there, Yarbrough said.
Nike earned $685 million, or 76 cents a share, in its fiscal third quarter ended February 28, compared to $866 million, or 73 cents per share a year earlier. Excluding discontinued operations, Nike had a profit of 76 cents per share for the quarter.
Shares were up 1.4 percent in premarket trading.
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