Nike Warns of Sharply Lower Earnings

Nike Inc. said it expects earnings for its fiscal third quarter ending Saturday to be between 24 cents and 28 cents a share, far below Wall Street’s consensus estimate of 38 cents a share. The Beaverton, Ore.-based maker of sports shoes and other apparel cited higher-than-anticipated order-cancellation rates in Asia and aggressive pricing of close-out inventories in the U.S. and Japan. Nike also said it expects earnings for the full year to fall below the previously stated range of $2 to $2.15 per share. Nike said it is working to improve its inventory problems, examining its overall cost structure and planning “realignments and reductions in its global work force” that will probably result in a restructuring charge. Nike shares fell $3.56 to $43.13 in third-market trading, after the news. The third market represents trading among institutional investors, away from the established markets such as the NYSE and Nasdaq.