Nike’s revenue overall rose slightly in the latest quarter and topped analysts’ estimates.
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Global supply-chain constraints continue to hurt Nike Inc.’s NKE -2.71% sales. The sneaker giant reported for a second consecutive quarter that its growth was stunted by a slowdown of production and transportation of its goods around the world.
Nike posted revenue of $11.4 billion in the quarter ended Nov. 30, up 1% from the same period a year earlier. Analysts expected revenue of $11.2 billion.
Demand for Nike’s goods continues to outpace supply. The previous quarter Nike reported a 10-week delay in production due to a lockdown in Vietnam and said it expected flat revenue growth for the November quarter.
On Monday, Nike said revenue in China, Asia Pacific and Latin America declined mainly because of low inventory levels resulting from Covid-19-related factory closures.
“Nike’s strong results this quarter provide further proof that our strategy is working, as we execute through a dynamic environment,” Nike President and Chief Executive John Donahoe said in a statement. “We are now in a much stronger competitive position today than we were 18 months ago.”
Nike’s net income for the November quarter was $1.3 billion, up 7% from a year earlier. Earnings per share were 83 cents, exceeding what analysts had projected.
Direct sales rose 9% to $4.7 billion. Digital sales increased 12%.
With the Omicron variant spreading quickly around the world, there is new uncertainty about whether port or factory closures could interfere with production or shipping schedules. Some countries are imposing restrictions to curb the number of infections.
More than half of Nike’s footwear and about a third of its apparel manufacturing occurs in Vietnam, where Covid-19 cases reached their highest daily average last week.
Nike last week said it acquired Rtfkt, a startup that creates nonfungible tokens, or NFTs, of sneakers and other collectibles. The company didn’t disclose the details of the deal. Nike also recently filed trademark applications indicating it wants to sell NFTs of its sneakers, clothing and other goods stamped with its swoosh logo.
Analysts say the moves speak to the company’s ambitions to quickly enter the market for virtual goods and also reflect the acceleration of its digital strategy. It could also help Nike sidestep the supply crunch. Competitor Adidas AG launched a collection of NFTs last week and raked in about $23 million.
Write to Inti Pacheco at [email protected]
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Appeared in the December 21, 2021, print edition.
