© Reuters. FILE PHOTO: A jogger wearing Nike shoes runs along the Charles River in Cambridge, Massachusetts, U.S., March 18, 2019. REUTERS/Brian Snyder/File Photo
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(Reuters) -Nike topped Wall Street estimates for first-quarter profit on Thursday as higher prices of its sneakers and apparel helped offset a hit from waning demand and persistent cost pressures.
The company’s shares were up about 2% in extended trading.
Nike (NYSE:)’s inventories also fell 10%, indicating the company has been successful in reducing excess product stocks ahead of the holiday season.
The company’s strong brand would help it maintain its premium pricing even in a more promotional environment, analysts have said, adding that as competition in sportswear heats up, its leading position and innovative products would also help Nike outpace other brands.
That comes against the backdrop of U.S. consumers having sharply cut back on discretionary spending, which has prompted wholesalers to place fewer orders, denting business in North America, Nike’s largest market, where revenue slid 2% in the first quarter.
Nike posted total revenue of $12.94 billion in the quarter, missing analysts’ estimates of $12.98 billion, according to LSEG data.
The company reported a profit of $1.45 billion, or 94 cents per share, beating estimates of 75 cents per share.
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