Nike Confirms Partnership With Amazon -- Update

By Sara Germano 

Nike Inc.'s chief executive said the company is starting a pilot program to sell sneakers through Amazon.com Inc., ending a long stalemate between the sportswear giant and the online retailer.

In a call with analysts Thursday, Nike CEO Mark Parker said that Amazon would carry "a limited Nike product assortment" of footwear, apparel, and accessories, and that Nike was seeking to improve its presence on the e-commerce site.

"We're in the early stages, but we really look forward to evaluating the results of the pilot," Mr. Parker said.

The Wall Street Journal previously reported that Nike and Amazon had struck a deal to sell some swoosh products, as both companies seek to combat counterfeiters and Nike aims to gain control over unsanctioned third-party sales. Though Nike didn't sell direct to Amazon, it was the most-purchased apparel brand on the site, according to a recent Morgan Stanley survey.

Nike's partnership with Amazon follows nearly a decade of meetings between the two companies and long-running resistance by Nike to Amazon's pitches. A contracting sportswear retail industry coupled with an expanding marketplace for Amazon's third-party sellers helped spur the agreement, according to people familiar with the matter.

Nike said its revenue in the fiscal fourth quarter rose 5% to $8.7 billion, largely driven by gains in China and emerging markets. Sales in North America -- Nike's largest market -- totaled $3.76 billion in the quarter, but that fell short of the $3.8 billion expected from analysts surveyed by FactSet.

Shares, up 4.6% so far this year, rose 4.8% to $55.70 in after-hours trading.

Overall, Nike's quarterly profit rose to $1.01 billion, or 60 cents a share, from $846 million, or 49 cents a share, a year earlier. Gross margin narrowed to 44.1% from 45.9% a year earlier.

--Maria Armental contributed to this article

Write to Sara Germano at [e-mail]

(END) Dow Jones Newswires

June 29, 2017 18:21 ET (22:21 GMT)

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