Nike

Nike Posts Q2 EPS of $1.03 on Revenue of $13.4 Billion, Vs CIQ Analyst Consensus of $0.85/Share on Revenue of $13.4 Billion.

Nike: See Pre-tax Restructuring Charges of About $400M to $450M, Primarily Associated With Employee Severance Costs.

Nike: As We Look Ahead to a Softer 2H Rev Outlook, We Remain Focused on Strong Gross Margin Execution and Disciplined Cost Management.

NIKE, Inc. Reports Fiscal 2024 Second Quarter Results BEAVERTON, Ore.—-December 21, 2023– NIKE, Inc. (NYSE:NKE) today reported fiscal 2024 financial results for its second quarter ended November 30, 2023. — Second quarter revenues were $13.4 billion, up 1 percent on a reported basis compared to the prior year and down 1 percent on a currency-neutral basis* — NIKE Direct revenues were $5.7 billion, up 6 percent on a reported basis and up 4 percent on a currency-neutral basis — NIKE Brand Digital sales increased 4 percent on a reported basis and 1 percent on a currency-neutral basis — Wholesale revenues were $7.1 billion, down 2 percent on a reported basis and down 3 percent on a currency-neutral basis — Gross margin increased 170 basis points to 44.6 percent — Diluted earnings per share was $1.03 for the second quarter, up 21 percent — NIKE, Inc. is announcing an enterprise initiative

Nike (NKE) late Thursday reported a surprise gain in fiscal second-quarter earnings even as its revenue fell short of Wall Street’s estimates, while the athletic footwear and apparel maker outlined plans to cut costs by up to $2 billion over the next three years. Earnings rose to $1.03 per share during the three months ended Nov. 30 from the year-ago period’s $0.85, which was the Capital IQ-polled consensus for the most recent period. Revenue edged 1% higher to $13.39 billion but lagged the Street’s $13.43 billion view. The stock fell 5.5% in after-hours trading activity. Revenue for the Nike brand added 1% year over year to $12.87 billion, driven by gains in footwear and equipment. North American sales slipped 4%, while Europe, the Middle East and Africa reported a 2% rise. The company said its cost-savings initiatives will likely include simplifying its product assortment, increasing automation, streamlining the organization, and

Nike’s $2 billion cost-cutting plan will focus on product innovation, storytelling and competitive separation, CEO John Donahoe says in a call with analysts. The shoe and apparel company is introducing new franchises and concepts to elevate its offerings, even though it will take time for the innovation cycle to ramp-up. Nike’s Jordan Brand, women’s and running businesses need investments to reach their full potential, Donahoe says. The Jordan Brand is on a path to become the second-biggest footwear brand in North America. At the same time, about 40% of Nike’s customers are women and their demand for more products is growing. Nike’s shares drop 7.2% to $113.77 in after-hours trading.

Nike’s restructuring plan aims to compete and win in the current market, CEO John Donahoe says in a call with analysts. The shoe and apparel company, which focused on liquidating excess inventory in the 2Q in the midst of a highly promotional environment and increasing macro volatility, is seeing signs of cautious spending among customers. “Total retail sales across the marketplace fell short of our expectations with softer demand outside of the key consumer moments,” CFO Matt Friend says. Nike did, however, see strong consumer response to newness and premium innovation. The company is reducing management layers as part of its cost-cutting measures. Shares drop 9%, to $111.50, in after-hours trading.

By Sabela Ojea Nike cut its revenue outlook for the year amid concerns that consumers around the world are becoming more cautious with their spending. The sneaker and apparel company on Thursday said it anticipates softer sales for the second half of the year. It also plans to shave up to $2 billion in costs over the next three years through streamlining the organization and shedding employees among other moves. Shares plunged nearly 11% in after-hours trading. For the fiscal year ending in May, Nike now expects revenue growth of about 1% from the prior year, down from its prior forecast of revenue rising by a mid-single-digit percentage. Nike dealt with soft demand outside of heavy shopping moments like those tied to back-to-school shopping and Black Friday, Chief Financial Officer Matt Friend told analysts on a conference call. The company also experienced weaker traffic to its digital platforms and competitors

The following is a summary of the NIKE, Inc. (NKE) Q2 2024 Earnings Call Transcript: Financial Performance: NIKE reported its second $13 billion quarterly earning, with over 20% growth in earnings per share. The holiday season saw growth nearing 10% with the strongest Black Friday week in company history. Marginal growth of 1% was reported in Q2 revenue, spurred by disciplined execution and marketplace management, with NIKE Direct experiencing a 4% growth. A 44.6% expansion in gross margins due to strategic pricing, increased supply-chain efficiency, and improved markdowns, mitigated only partly by increased product input costs. Double-digit drops were observed in total footwear and apparel inventory units, signifying progress in inventory management. Business Progress: The company is directing efforts towards areas with significant growth potential, such as the Women’s and Jordan divisions. Significant advancements were made in sports innovation, backed by the recognition received by athletes using NIKE products. Plans

By Sabrina Escobar Wall Street is feeling more upbeat about Nike’s 2024 outlook — but analysts are a lot more tepid about the retailer’s earnings report coming Thursday afternoon. Over the past few months, Street sentiment on Nike stock has been improving. Investors have rallied behind the prospect of bigger margins now that the company is seeing better freight costs and less discounting. Just last week, Citi analyst Paul Lejuez upgraded shares of Nike to Buy from Neutral, arguing that Nike is an “attractive margin recovery story” amid a choppy macroeconomic environment. And earlier in December, Wells Fargo analyst Ike Boruchow added Nike to his top picks list, swapping out competitor Lululemon Athletica in the process. “We simply believe the recovery characteristics and self-help story now beginning at [Nike] make for a more compelling long idea into 2024,” Boruchow wrote at the time. But first, the company has to wrap

Nike (NYSE:NKE) Stock Analyst Ratings Date Upside/Downside Analyst Firm Price Target Change Rating Change Previous / Current Rating 12/19/2023 7.06% Raymond James $121 → $130 Maintains Outperform 12/15/2023 15.29% Telsey Advisory Group $128 → $140 Maintains Outperform 12/12/2023 7.06% DZ Bank → $130 Upgrades Hold → Buy 12/11/2023 11.18% Citigroup $100 → $135 Upgrades Neutral → Buy 12/05/2023 14.47% Goldman Sachs → $139 Assumes → Buy 11/17/2023 -11.06% Truist Securities → $108 Initiates Coverage On → Hold 11/07/2023 2.12% Evercore ISI Group → $124 Initiates Coverage On → Outperform 10/06/2023 -6.94% RBC Capital → $113 Reiterates Outperform → Outperform 09/29/2023 -24.24% Williams Trading $91 → $92 Upgrades Sell → Hold 09/29/2023 -9.41% BMO Capital $120 → $110 Maintains Outperform 09/29/2023 3.76% Morgan Stanley $126 → $126 Reiterates Overweight → Overweight 09/29/2023 -1.18% TD Cowen $117 → $120 Maintains Outperform 09/29/2023 12% Goldman Sachs $145 → $136 Maintains Buy 09/29/2023 -2%

Nike’s (NKE) shift from a wholesaler to a direct-to-consumer brand is spurring its next phase of margin-accretive revenue growth, , Morgan Stanley said in a Friday note. The company is also poised to benefit from growing demand for comfortable activewear due to work-from-home preferences and focus on health and wellness. Nike’s “strategic portfolio decisions, tech investments, and supply chain innovation also create (long-term) competitive advantages, and are further supported by an industry-leading balance sheet,” it said. The company, however, is unlikely to deliver on its long-term growth and profitability targets until fiscal Q4, Morgan Stanley said. Nike’s fiscal Q2 revenue could miss expectations given ongoing softness in the wholesale business that has also resulted in lower-than-expected quarterly sales by many branded peers, unexpected weather-related headwinds in the EMEA region and a challenging global macro environment, it said. While the company is expected to maintain full-year profitability and earnings guidance, “we’re