Nike Zips Past Estimates

Profit jumps 10% in the fiscal second quarter.
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Updated from 5:14 p.m. EST

SAN FRANCISCO --

Nike

(NKE) - Get Report

sailed past estimates for the second quarter, helped by continued strength overseas.

Sales have been booming in China particularly, which the athletic-gear retailer expects to carry through next year's Olympics in Beijing. But in the U.S., the brand has not seen as much growth, held back in part by weak sales of apparel.

For the quarter ended Nov. 30, the Beaverton, Ore.-based company posted a profit of $359.4 million, or 71 cents a share, compared with $325.6 million, or 64 cents last year. Analysts expected second-quarter earnings of 66 cents, according to Thomson Financial.

Revenue grew 14% to $4.34 billion, compared with $3.82 billion a year ago, with foreign-currency changes adding 4 percentage points to the gain. Wall Street estimated sales of $4.21 billion.

Futures orders for footwear and apparel -- which measure deliveries slated for December through April -- totaled $6.5 billion, a 13% increase over last year. Foreign currency added 3 percentage points to the growth.

"Our strategy for continued growth is very clear -- commit totally to the consumer, deliver innovative and relevant product, and focus our execution and discipline on those parts of the business that offer the greatest growth opportunity," said Chief Executive Mark Parker in a statement.

Sales in the U.S. jumped 7% in the second quarter to $1.5 billion from $1.4 billion last year. Future orders jumped 21%.

In Europe, sales grew 18% to $1.2 billion from $1.0 billion a year earlier, while futures orders rose 19%. Changes in currency exchange rates increased revenue growth by 10 percentage points.

Sales in the Asia Pacific region soared 17% to $674.6 million from $578.2 million a year ago. Changes in currency exchange rates added 5 percentage points to the growth. Futures orders showed the strongest growth in Asia, rising 24%.

The company continues to open stores in China at a rapid pace of about 500 to 600 a year, moving from top-tier cities into second-tier cities.

In the Americas, Nike's second-quarter sales increased 19% to $313.6 million from $262.5 million a year ago. Currency exchange rates contributed 5 percentage points.

Nike expects its revenue to grow in the low double-digit percentages in the second half of the year.

In October, the company agreed to acquire Umbro in an effort to significantly expand its presence in the soccer market.

"We're very excited about leveraging those connections and bringing them to life in new ways that will reward consumers and strengthen our competitive stance in football all around the world," Parker said.

On Wednesday's conference call with analysts, Parker said he sees more opportunities for future acquisitions, however, he did not anticipate any in the near future.

Nike said it is still exploring the sale of the Bauer Hockey business after deciding that the brand did not align with its long-term growth priorities. It completed the sale of its Starter brand to

Iconix

(ICON) - Get Report

for $60 million in cash on Dec. 17.

Shares for the company were up 3.5%, or $2.20, to $66 in after-hours trading.