Nike: shares down after margins disappoint
(CercleFinance.com) - Nike shares fell on Friday, wiping over 2 billion dollars off the company's market value, a day after it reported disappointing gross margins in its quarterly results.
Revenue rose by 10% to 10.3 billion dollars in the second quarter ended 30 November, the sportswear maker said. Net income jumped by 32% to 1.1 billion dollars, while diluted EPS increased 35% to 0.70 dollar.
While the company's results topped analysts' expectations, its gross margin came in below the company's forecast.
Gross margin increased just 20 basis points to 44%, primarily due to higher product costs, largely due to incremental tariffs in North America.
In comparison, the company said that it expected a 25 basis point increase, while the consensus was even more optimistic, having estimated a 30 basis point increase.
According to analysts, the group's performance is disappointing considering that Nike has many encouraging new potential drivers ahead, such as international sales or its direct-to-customer segment.
Nike shares were trading 1.5% lower at 99.6 dollars in early morning trading on Friday.
Copyright (c) 2019 CercleFinance.com. All rights reserved.
Revenue rose by 10% to 10.3 billion dollars in the second quarter ended 30 November, the sportswear maker said. Net income jumped by 32% to 1.1 billion dollars, while diluted EPS increased 35% to 0.70 dollar.
While the company's results topped analysts' expectations, its gross margin came in below the company's forecast.
Gross margin increased just 20 basis points to 44%, primarily due to higher product costs, largely due to incremental tariffs in North America.
In comparison, the company said that it expected a 25 basis point increase, while the consensus was even more optimistic, having estimated a 30 basis point increase.
According to analysts, the group's performance is disappointing considering that Nike has many encouraging new potential drivers ahead, such as international sales or its direct-to-customer segment.
Nike shares were trading 1.5% lower at 99.6 dollars in early morning trading on Friday.
Copyright (c) 2019 CercleFinance.com. All rights reserved.