Nike Inc. (NYSE: NKE) shares are trading higher on Thursday ahead of the company’s first-quarter earnings report, which is scheduled to be released after the market close. At the time of publication, the stock was up 1.21% to $35.83, a level near its 52-week low of $35.15.
Wall Street analysts are projecting that Nike will post first-quarter revenue of $11.33 billion. This figure would represent a decline from the $11.72 billion reported in the same period a year ago. On the profit side, analysts forecast earnings per share of 44 cents, down from 49 cents in the prior year.
Despite these projected declines, the company has a history of beating revenue forecasts, having topped estimates for seven consecutive quarters and in eight of the last 10 quarters. Additionally, Nike has beaten EPS estimates for 12 consecutive quarters.
The company’s most recent report, covering the fiscal fourth quarter ended May 31, provides context for the upcoming numbers. Full-year revenue for that period came in at $46.4 billion, which was flat on a reported basis but down 2% when currency effects were stripped out. Fourth-quarter revenue alone totaled $11.0 billion, a decrease of 1% as reported and 4% on a currency-neutral basis.
Revenue performance was mixed within the company. Wholesale revenue grew 4% to $6.6 billion, while Nike Direct revenue fell 7% to $4.1 billion. This split between wholesale strength and direct-to-consumer weakness is noted as a pattern investors are watching again this quarter.
The article notes that while a beat on both revenue and earnings would extend Nike's streak of topping estimates, it may not be sufficient to break the stock out of its current downtrend without additional catalysts such as a major new product launch or acquisition.
