The athletic giant reported fiscal first quarter net income of $599 million, or $1.14 per share, compared with $513 million, or $1.04 per share, for the same period in 2009. Revenue rose 8% from last year, to $5.18 billion. While the figures beat the average Wall Street analysts who had expected a much smaller profit of $1.01 per share, they had also predicted higher revenue of $5.22 billion.
Revenues for the Nike brand were up 8%, while revenues for its other businesses, including Cole Haan, Converse, Hurley, Nike Golf and Umbro, increased 16%.
As of the end of the quarter, worldwide futures orders for Nike brand athletic footwear and apparel, scheduled for delivery from September to January 2011, totaled $7.1 billion, 10% higher than the same period last year.
By geography, Nike’s futures orders to North America are up by 15%, Central and Eastern Europe by 8% and China by 25%. Western Europe future orders are down 7% though, while Japan orders fell 8%, Nike reported.
“We had a great first quarter. It demonstrates the power of our growth strategy, which is to create innovative products, amazing brand experiences, and premium retail destinations wherever consumers connect with Nike,” said Mark Parker, president and ceo.“Going forward we’ll continue to maximize the flexibility, balance and alignment that we have built into our portfolio of brands and categories. Those strengths will help us navigate the continued uncertainty in the macro-economic picture. More importantly they help us leverage the global appetite for sports and innovation, which has never been stronger. That’s how we continue to grow our businesses, strengthen our balance sheet and increase our returns to shareholders over the long term.”
FIFA World Cup: ‘Best Ever for Nike’
Charlie Denson, president of the Nike brand, told investors that Nike had its best FIFA World Cup ever in South Africa this summer. But while he is correct in saying that Andrés Iniesta kicked the winning goal for Spain wearing a pair of Nike boots, it is worth noting that the victors were wearing the three stripes of Adidas.
Soceer aside, Nike has also boosted its presence in surfing, basketball and running through recent top-level endorsement deals. As a result, demand for Nike products is peaking, especially in China and the United States, with future orders from now until January 2011 10% higher than the same period last year.
“With one look at our futures, you can see the demand is high,” Denson said. “It’s a great position to be in. But it does come with some challenges, specifically with select technical footwear and performance apparel products.We are working closely with all our manufacturing partners to accelerate production and meet demand on these highly sought after products.”