Nike profits rise as China leads sales recovery

The sportswear titan recorded a 71% spike in net income to $1.4bn (£1bn) in its third quarter, covering the three months to February 28.

Total revenues across the group rose 3% to $10.4bn (£7.5bn), although sales of its eponymous Nike brand slipped 2% to $9.8bn (£7.1bn) as global container shortages, port congestion delays in the US and store closures across Europe dented its wholesale business.

Sales in Greater China surged 51% compared with a 10% decline in Nike’s native North American market.

In Europe, the Middle East and Africa (EMEA), Nike said that, while physical sales dropped as a result of store closures, digital sales in those regions jumped 60%.

It added that 65% of its stores in EMEA are now open and trading, although some are only operating reduced trading hours.

Gross margin increased 130 bps to 45.6% during the period, while operating expenses dropped 3% to $2.3bn (£1.7bn) as a result of lower wage costs and a “disciplined” approach to spending.

Nike president and chief executive John Donahoe said: “Nike continues to deeply connect with consumers all over the world driven by our strong competitive advantages.

“Our strategy is working as we accelerate innovation and create the seamless, premium marketplace of the future. I’ve never been more confident in our leadership and teams to operate with agility in a dynamic environment.”