Nike stock rallies as retailer sees 36% growth in digital sales

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Nike Inc. NKE,
-5.02%
Shares rose more than 5% in Tuesday’s extended session after the retailer reported fiscal third-quarter results that beat Wall Street expectations and said its digital sales rose 36%. Nike said it earned $847 million, or 53 cents per share, in the quarter, compared with $1.1 billion, or 68 cents per share, in the year-ago quarter. Revenue increased 5% to $10.1 billion, driven by 13% growth in Nike Direct, with digital growth of 36% and strong growth across multiple Nike markets, including North America North, which offset the impact of COVID-19 on Nike’s business in China. Analysts polled by FactSet expected Nike to report EPS of 51 cents on sales of $9.8 billion. “In an extraordinarily dynamic time, Nike’s strong results are a testament to our deep consumer relationships, compelling product innovation and agile teams around the world,” Chief Executive John Donahoe said in a statement. “As we begin to see a recovery in China, no one is better equipped than Nike to navigate the current climate,” he said. Nike said its inventory was $5.8 billion, up 7% from the prior year period, “reflecting strong anticipated demand across all geographies as well as higher inventories in Greater China due to COVID-19”. The company had cash and short-term investments of approximately $3.2 billion. Shares of Nike ended the regular trading day up 15%.

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