Nike shares jump as retailer lays out new growth targets
Nike shares jumped on Wednesday as the sporting-goods retailer offered a glimpse at its sales expectations for the future.
At its investor day in Portland, Oregon, Nike said it expects earnings-per-share growth in the mid-teens over the next five years.
The company added that it anticipates revenue growth in the high-single digits over the same period.
Nike shares jumped more than 2% on the news, and were last trading up a little more than 1%.
Looking ahead, Chief Executive Mark Parker told analysts and investors that digital revenues should grow 15% to 30% over a five-year period. Prior to Wednesday, the company had already set a revenue goal of $50 billion by 2020.
Earlier this year, Nike posted strong sales growth in its international geographies, particularly China. Meantime, Nike's North America wholesale revenues continued to decline into the fiscal first quarter and ahead of the all-important holiday season.
In a competitive retail environment, Nike is seen as favoring discounts and heavy spending to grow its direct-to-consumer business. In June, Nike revealed plans to cut about 2% of its global workforce, also trimming its geography segments from six to four — signs the company is trying to reduce expenses.
Nike is also in the midst of working on a pilot program with Amazon, which allows the Oregon-based retailer to directly sell a limited product assortment on Amazon.com, something Nike had refused to do for decades.
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