Nike's net income tops estimates
NEW YORK - Nike's (NKE) fiscal fourth-quarter net income rose 5 percent as higher revenue in most geographic regions offset heavy investments in marketing for the World Cup soccer tournament.
Results for the March-May quarter topped expectations.
Nike is outfitting 10 teams, including the U.S. team, during the World Cup taking place now in Brazil. It also introduced four new soccer shoes ahead of the tournament. More athletes are wearing its shoes at the World Cup than all other brands combined, with more than a third of them wearing Nike's Magista soccer cleats, said Trevor Edwards, the president of the Nike brand. Nike's soccer gear is also doing well in Nike stores, online and in other companies' shops, Edwards said on a call with investors.
Soccer revenue grew 21 percent during the fiscal year to $2.3 billion.
The athletic gear maker said Thursday that net income for the three months ended May 31 rose to $698 million, or 78 cents per share. That compares with net income of $662 million, or 76 cents per share, in the same quarter last year. Analysts expected 75 cents per share, according to Fact Set.
Revenue rose 11 percent, to $7.43 billion from $6.7 billion, and topped Wall Street's prediction of $7.34 billion. Revenue for the Nike brand increased 13 percent to $7 billion. Revenue rose in all geographic regions except Japan.
The company's quarterly marketing costs rose 10 percent to $3 billion, partly due to the World Cup.
In a good sign for the current quarter, Beaverton, Oregon-based Nike said that orders for deliveries scheduled from June through November rose 11 percent compared with a year ago.
For the year that ended on May 31, net income rose 9 percent to $2.69 billion, or $2.97 per share, compared with $2.47 billion, or $2.68 per share. Revenue rose 10 percent, to $27.8 billion from $25.31 billion.
Shares rose $2.71, or 3.5 percent, to $79.57 in aftermarket trading. The stock had been down about 2 percent in 2014.
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