(Reuters) - Nike Inc (NKE.N), the world’s largest footwear maker, reported futures orders that breezed past analysts’ estimates, powered by strong demand in North America and China.
The company’s shares, already the top performing year-to-date Dow component, rose 2.5 percent to $135.23, in extended trading on Tuesday.
The Nike brand orders for delivery from December through April, a gauge of demand the company calls “futures orders”, rose 20 percent, excluding currency, as of Nov. 30.
Analysts on average had expected futures orders growth of 13.6 percent, according to Consensus Metrix.
Futures orders in Greater China - a fast-growing market - jumped 34 percent, the biggest jump in two years. It rose 14 percent in North America.
New footwear launches in the basketball, running and sports categories are helping Nike draw customers toward higher-priced products, while the “athleisure” trend is driving sales in the athletic apparel sector.
Nike’s higher-margin Jordan, LeBron, Kobe and KD basketball shoe brands have been especially popular in the U.S., helping drive sales of the company’s footwear division.
The company’s running shoe brands, which include Lunar, Free, Flyknit, Roshe Run, Huarache and Max Air, have also seen rising demand.
“Nike has the space to themselves right now, competition is virtually non-existent for the company,” Edward Jones analyst Brian Yarbrough said, adding that the company’s focus on product innovation, the health and wellness segment are boosting demand.
Revenue from North America, Nike’s largest market, rose 9.4 percent in the second quarter ended Nov. 30. Footwear sales in the region rose 12.3 percent to $2.16 billion.
Sales in Greater China rose 24 percent, helped by overhauled stores and greater online traffic.
Nike said net income jumped 20 percent to $785 million, or 90 cents per share.
The company said net income also benefited from a lower effective tax rate.
Revenue rose 4.1 percent to $7.69 billion.
Analysts on average had expected earnings of 86 cents per share and revenue of $7.81 billion, according to Thomson Reuters I/B/E/S.
Reporting by Yashaswini Swamynathan, Additional reporting by Ramkumar Iyer in Bengaluru