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Last night Nike released their third quarter numbers. Of course, that was during a completely different era. The PreCorona era. But they did give some updates on recent trends.
Earnings per share came in at $0.78 versus consensus of $0.69. A solid beat. Revenue grew 5.1%. This was largely due to solid demand in China which was already experiencing COVID-19 disruptions. Chinese demand dropped by 4% versus consensus of -22%. This was thanks to digital sales increasing 30%.
Nike moved fast in China to close stores. But they noticed strong trends online and within its app ecosystem. 30 days ago they started reopening stores in China and experienced weekly double digit growth. Ecommerce has continued to accelerate despite stores reopening. In fact online has seen triple digit growth since things have gone back to normal. This virus has forced many sideliners to purchase online. After a good experience, they will never look back.
They have seen similar trends in Japan and South Korea. In the US online sales have grown by triple digits in the last week. As I mentioned in a previous message, Nike's online sales capabilities are world class. People are bored, online shopping makes them feel good. Online retail therapy!
The Nike share price has jumped 15% yesterday and is up another 10% pre market. The brand is as strong as ever. Stores may be closed around the world but they will reopen and people will continue to buy online.
