A Nike store sits closed following the outbreak of coronavirus in New York on March 24, 2020.CARLO ALLEGRI/Reuters
Nike Inc beat Wall Street estimates for quarterly revenue on Tuesday, powered by demand in North America and Europe that blunted the first drop in China sales in nearly six years due to the coronavirus-fueled shutdowns.
The company’s shares, a member of the blue-chip Dow Jones Industrial Average, rose about 7 per cent after the closing bell.
Nike said sales in Greater China, its fastest-growing region, fell 4 per cent in the third quarter ended Feb. 29 as it was forced to shut about 75 per cent of company-owned and partner stores following the coronavirus outbreak.
Since first detected in China last year, the virus has spread rapidly across the globe and infected nearly 400,000 and killed over 17,000, forcing governments to impose lockdowns and restrict travel to contain the outbreak.
In North America, revenue rose 4 per cent and in Europe it surged 11 per cent.
However, Nike and other retailers have shut stores in the United States and Europe to curb the spread of the virus.
Total revenue rose 5.1 per cent to $10.10 billion in the third quarter, beating analysts’ average estimates of $9.80 billion, according to Refinitiv IBES data.
Overall digital sales grew 36 per cent, while it climbed more than 30 per cent in Greater China, where Nike launched its app late last year.
Net income fell to $847 million, or 53 cents per share, from $1.10 billion, or 68 cents per share, a year earlier, due to the hit from the health crisis and a non-cash charge related to a shift to distributor model in South America.