It was a bit of a shock for Nike, who saw shares rising to almost 5 percent, which is a new high for the company, and earnings blew past projected numbers. Nike had said previously that the strong dollar would hurt business and lead to severe sales declines, but for now, the strong dollar is giving Nike the biggest boost it ever had.
Although the future orders of Nike was only up 2 percent in this quarter, excluding the strong dollar repercussions, sales were actually 11 percent. Investors did not really look at the 2 percent number, but instead focused on the company’s future orders without factoring in the impact of the stronger dollar. Nike is a huge company, so to see an 11 percent jump is quite amazing, and it beat out all previous projections from Wall Street and investors.
The strong dollar was supposed to impact overseas sales and growth, but Nike said that the future orders were the biggest in China and Europe, which puts aside fears of American products doing well overseas because of the dollar. Nike is continuing to innovate the market and this allows the company to see more growth and bigger sales, and it’s advertisement campaigns have been extremely successful overseas too.
Although Nike is doing well right now, there is beginning to be more competition than ever before, with the company Under Armour growing at a faster rate than Nike, and Under Armour also saw stocks rise to new heights the same day as Nike did. The strong dollar still needs to be considered a questionable situation too, so while Nike is extremely happy, there seems to be a little cautious optimism at this point. Investors increased prices for Nike after hearing the newest reports, which means Nike could rise even higher before all is said and done.
In the retail department, Foot Locker also saw stocks rise to a high after the Nike report, so it appears that Nike is helping more companies boost sales and increase overall growth. Nike is also going to continue focusing on innovation and research and development to ensure that the company is always coming out with new products, and trying to achieve the next best thing as far as technology integration is concerned. It seems that nothing can stop Nike from reigning as the dominant shoe manufacturer, not Wall Street nor the strong dollar, and Nike will be a force to be reckoned with for many years to come.