The Gory Details of Nike's Earnings Miss (NKE)

The Gory Details of Nike's Earnings Miss

Nike (NYSE: NKE ) reported earnings on June 28. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended May 31 (Q4), Nike met expectations on revenues and whiffed on earnings per share.

Compared to the prior-year quarter, revenue grew and GAAP earnings per share dropped.

Margins contracted across the board.

Revenue details
Nike recorded revenue of $6.47 billion. The 17 analysts polled by S&P Capital IQ hoped for a top line of $6.51 billion on the same basis. GAAP reported sales were 12% higher than the prior-year quarter's $5.77 billion.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $1.17. The 19 earnings estimates compiled by S&P Capital IQ forecast $1.37 per share. GAAP EPS of $1.17 for Q4 were 4.9% lower than the prior-year quarter's $1.23 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 42.8%, 150 basis points worse than the prior-year quarter. Operating margin was 12.1%, 150 basis points worse than the prior-year quarter. Net margin was 8.5%, 180 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $6.40 billion. On the bottom line, the average EPS estimate is $1.15.

Next year's average estimate for revenue is $25.96 billion. The average EPS estimate is $5.19.

Investor sentiment
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 2,173 members out of 2,304 rating the stock outperform, and 131 members rating it underperform. Among 650 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 623 give Nike a green thumbs-up, and 27 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Nike is outperform, with an average price target of $120.85.

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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Motley Fool newsletter services have recommended buying shares of Nike. Motley Fool newsletter services have recommended creating a diagonal call position in Nike. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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