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Nike's First Quarter Earnings Report
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Nike (NYSE:NKE) announced its results for the most recent quarter on September 27, 2012. Nike designs and markets high-quality footwear, apparel, equipment, and accessory products throughout the world.
Investors should care about a company's quarterly earnings because it shows the state of the business over the past 90 days and provides guidance for the following 90 days. SEE: 12 Things You Need To Know About Financial Statements
The Numbers: Nike beat expectations with its latest EPS and revenue figures. The company reported $1.23 per share versus the $1.13 per share estimate and revenues of $6.67 billion versus the $6.51 billion estimate. EPS fell 9.6% while revenue climbed 9.7% from the same period last year. Nike's revenue has grown during each of the past four quarters on a year-over-year basis. Nike's net income for the first quarter was $567 million. According to the reported number, this is down 12.1% from last year's figures. This marks the second quarter in a row that the company's net income has fallen after profits tumbled 7.6% in the fourth quarter of the last fiscal year.
Management Quote: "We had a strong first quarter and a great start to the fiscal year. NIKE, Inc. delivered an amazing array of innovation across some of the biggest moments in sport," said Mark Parker, President and CEO, NIKE, Inc. "Innovation is how great companies sustain growth and build competitive separation. We'll continue to make strategic investments across our portfolio of businesses to capture our full potential over the long term and drive shareholder value."
A Look Back: Last quarter marked the fifth straight quarter that the company saw shrinking gross margins, as gross margin fell 0.8 percentage point to 43.5% from the year-earlier quarter. Over that time, margins have contracted on average 1.9 percentage points per quarter on a year-over-year basis.
Net income has increased 1.1% year-over-year on average across the last five quarters. The biggest gain came in the first quarter of the last fiscal year, when income climbed 15.4% from the year-earlier quarter.
Looking Ahead: For the next quarter, analysts are growing pessimistic about the company's expected results. The average estimate for the second quarter is $1.01 per share, dropping from $1.18 a month ago. Decreasing earnings estimates is generally a negative sign as it suggests analyst believe future earnings to be weaker than previously anticipated. In the past month, the average estimate for the fiscal year has fallen from $5.78 per share to $5.14.
Investors should care about a company's quarterly earnings because it shows the state of the business over the past 90 days and provides guidance for the following 90 days. SEE: 12 Things You Need To Know About Financial Statements
The Numbers: Nike beat expectations with its latest EPS and revenue figures. The company reported $1.23 per share versus the $1.13 per share estimate and revenues of $6.67 billion versus the $6.51 billion estimate. EPS fell 9.6% while revenue climbed 9.7% from the same period last year. Nike's revenue has grown during each of the past four quarters on a year-over-year basis. Nike's net income for the first quarter was $567 million. According to the reported number, this is down 12.1% from last year's figures. This marks the second quarter in a row that the company's net income has fallen after profits tumbled 7.6% in the fourth quarter of the last fiscal year.
Management Quote: "We had a strong first quarter and a great start to the fiscal year. NIKE, Inc. delivered an amazing array of innovation across some of the biggest moments in sport," said Mark Parker, President and CEO, NIKE, Inc. "Innovation is how great companies sustain growth and build competitive separation. We'll continue to make strategic investments across our portfolio of businesses to capture our full potential over the long term and drive shareholder value."
A Look Back: Last quarter marked the fifth straight quarter that the company saw shrinking gross margins, as gross margin fell 0.8 percentage point to 43.5% from the year-earlier quarter. Over that time, margins have contracted on average 1.9 percentage points per quarter on a year-over-year basis.
Net income has increased 1.1% year-over-year on average across the last five quarters. The biggest gain came in the first quarter of the last fiscal year, when income climbed 15.4% from the year-earlier quarter.
Looking Ahead: For the next quarter, analysts are growing pessimistic about the company's expected results. The average estimate for the second quarter is $1.01 per share, dropping from $1.18 a month ago. Decreasing earnings estimates is generally a negative sign as it suggests analyst believe future earnings to be weaker than previously anticipated. In the past month, the average estimate for the fiscal year has fallen from $5.78 per share to $5.14.
by
Investopedia Staff
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