Nike Posts 70% Profit on Cost-Cutting

Nike Inc. said profit jumped a much-better-than-expected 70% in its fiscal third quarter to $124.2 million, or 44 cents a share, partly on the strength of cost-cutting efforts that included a reduction in NBA endorsements. The athletic apparel and shoe maker was expected to earn 38 cents, the average estimate of analysts surveyed by First Call Corp. Revenue slipped 2.1% to $2.18 billion. Chairman Phil Knight said the effort to hold down expenses will continue because domestic demand remains weaker than expected. “Despite continued softness in the U.S. athletic footwear and apparel retail market, we are beginning to see signs of increased consumer demand for our footwear,” Knight said. “While we are encouraged by these early indicators, we remain cautious on our prospects for near-term growth.” The results were announced after the close of trading. Nike fell $2.50 to close at $55 on the New York Stock Exchange.