Nike Inc (NYSE:NKE) posted third quarter sales that missed analysts’ estimates as the sports retailer continued to battle for market share in North America.
Shares fell 6.22% to US$54.40 in early US trading.
Revenue in the three months to 28 February rose 5% to US $8.43bn, falling short of analysts’ estimates of $8.47bn.
Competition in the footwear market from retailers like Adidas and Under Armour weighed on Nike’s sales growth in North America, which accounts for about half of the group’s business. Sales rose just 3% in the region.
Adidas and Under Armour have been taking over market share in footwear after investing in marketing their brands and introducing new products.
Germany’s Adidas has recruited celebrities such as Pharrell Williams and Rita Ora to promote its brand while Under Armour poached the NBA's Golden State Warriors star Stephen Curry in 2013.
Nike is starting to turn to markets elsewhere for sales growth. It said third quarter group revenue was driven by Asia, Western Europe and emerging markets. Sales in Western Europe rose 10% while sales in China and emerging markets increased 15% and 13% respectively.
US sales continued to drive revenue for its Converse brand, however, rising 3% to $498mln.
Net income edged up to US$1.14bn, or 68 cents per share, from US$950mln, or 55 cents per share.
Gross margins fell 140 basis points to 44.5%, as higher product costs and foreign exchange headwinds offset higher average selling prices.