by InvestorPlace Staff | September 28, 2012 8:54 am
Sports apparel titan Nike (NYSE:NKE) was set to open lower Friday morning after revealing in its fiscal first-quarter earnings report that it was continuing to struggle in China.
Overall orders from September to January improved 8%, which was short of analysts’ hopes for 10% — that was weighed down by future orders in China, which declined 6%, compared to a 22% increase in the year-ago period.
Canaccord Genuity Corp. analyst Camilo Lyon illustrated the concern to Bloomberg Businessweek:
“The futures numbers are what’s most important and when you’ve got a negative China number and deceleration in global future numbers, that’s what’s driving the stock down. (The China orders) were worse than anyone expected.”
Q1 revenues improved 10% to $6.67 billion, beating Wall Street estimates. However, earnings of $567 million ($1.23 per share), while beating analyst expectations for $1.12 per share, still were down 12% from the year-ago period thanks to gross margins that shrank 80 basis points to 43.5%.
NKE shares were down 4% in Friday pre-market trading.
— Kyle Woodley, InvestorPlace Assistant Editor
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