Nike Takes Q3 25 Cent Coronavirus Charge, Tops Revenue Estimates

Nike shares jumped after hours despite a slight earnings miss as investors seemed to forgive the miss due to the negative charge the company took due to the coronavirus.
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Nike  (NKE) - Get Report shares jumped after hours Tuesday after the sports apparel and shoe maker reported third quarter revenue results that topped analyst estimates in the quarter. 

The Beaverton, Oregon-based company reported earnings of 53 cents per share on revenue of $10.1 billion. Analysts were expecting Nike to report earnings of 59 cents per share on revenue of $9.8 billion.

The coronavirus hangs as a cloud over most companies reporting results over the next few weeks, and Nike is no exception. Nike said it took a 25 cent per share non-recurring, non-cash charge related to the virus as well as other issues. 

“In an extraordinarily dynamic time, NIKE’s strong results are testament to our deep consumer connections, compelling product innovation and agile teams around the world. We know it’s in times like these that strong brands get even stronger,” said new Nike CEO John Donahoe 

Earlier this month, Nike announced that it is closing its stores in nations around the world for much of the rest of March in an effort to help contain the spread of the coronavirus pandemic. 

The company reported that China revenues fell 4% in the quarter, breaking a streak of 22 consecutive quarters of double digit growth in the country. However, revenue in China grew strong double digits in the country during the first two months of the third quarter.

“As we start to see recovery in China, no one is better equipped than NIKE to navigate the current climate," Donahoe said.   

Nike closed Tuesday's session up more than 15% and rose another 6.5% in the after hours trading session.