Shares for the company Nike rose as it announced a boost in sales from digital stores. Consequently, Nike shares increased by 13 percent on the trading of the same day.
Nike CEO and President, John Donahoe, said: “Our results this quarter continue to demonstrate Nike’s full competitive advantage, as we strengthen our position in the midst of disruption.”
Strong Spot in the Online Stores
While many stores and establishments closed as the pandemic hit the country, some found footing with the digital market. Nike also went on that same path, boosting its online sales. Particularly, their digital sales rose by 82 percent.
Nike beat analysts' revenue expectations for its first fiscal quarter by more than $1 billion, signaling the sportswear giant is making a healthy comeback from the pandemic. The company's stock jumped by several percentage points in after-hours trading. https://t.co/Xoqokmqc3h
— CNN Business (@CNNBusiness) September 22, 2020
According to CNN Business, Nike has strengthened and invested on its digital platform in the past years. Instead of relying on third-party retailers, the com company reported on Tuesday its revenue for the first quarter for fiscal 2021, amounting to $10.6 billion, even amid the health crisis.
Nike’s Revenue Performance
Despite beating expectations from analysts, the company’s revenue still fared one percent less compared to a year ago. Refinitiv estimated the revenue for Nike to only reach $9.14 billion.
pany focused on boosting its direct-to-consumer efforts. Essentially, it means reaching customers through digital channels, which has proven to pay off as the health crisis forced many people to do their shopping online.
Additionally, Nike also saw growth in its Sportswear and the Jordan Brand.
Disruption to Businesses
However, the company admits that despite opening most of its stores in the quarter, they still experience lower physical retail traffic. Nike said the reason stems from the COVID-19 impacts and protocols. Previously, the company said that it saw a 38 percent revenue drop in May.
Executive VP and CFO of Nike, Matt Friend, reckoned that the company recovered faster by growing their digital channels. He added, “We continue to drive investment in capabilities that will fuel our consumer-led digital transformation, catalyzing long-term growth and profitability for Nike.”
Although Nike could still face uncertainty with the pandemic, the company remained optimistic. Friend said projections for the full-year fiscal 2021 revenue could be up, CNN Business reports.