Nike Inc (NYSE:NKE) stock fell 7.68% (As on March 22, 11:22:42 AM UTC-4, Source: Google Finance) after the company beat Wall Street estimates for quarterly revenue, as deep discounts on its athletic apparel and sneakers during the holiday season helped it reel in shoppers. Revenues for the NIKE Brand were $11.9 billion, up 2 percent on a reported and currency-neutral basis, as currency-neutral growth in North America, Greater China and APLA was offset by declines in EMEA. Revenues for Converse were $495 million, down 19 percent on a reported basis and down 20 percent on a currency-neutral basis, primarily due to declines in North America and Europe. However, many analysts has downgraded the stock due to growth concerns.

Meanwhile, footwear products introduced over the past several quarters are on track to generate a multi-billion dollar run rate on an annual basis. Performance footwear grew high single digits this quarter with double-digit growth from $100-plus franchises, including Kobe and Ja in basketball, Metcon and Motiva in fitness, and Structure and Vomero in running. Women’s fitness footwear grew double digits, and key apparel franchises such as $100-plus leggings continued scaling with strong sell-through. New product journeys from Book 1 to Vomero 5 and V2K, to Lunar Roam and Travis Scott’s Jordan Jumpman Jack, drove consumer energy. And ahead of a new wave of Nike Air innovation, the Air Zoom Alphafly 3 debuted with a marathon world record and sellout launches across multiple markets around the world.

NKE in the third quarter of FY 24 has reported the adjusted earnings per share of 98 cents, beating the analysts’ estimates for the adjusted earnings per share of 76 cents. The company had reported the adjusted revenue of $12.43 billion in the third quarter of FY 24, beating the analysts’ estimates for revenue of $12.27 billion. Moreover, Nike Direct was up slightly versus the prior year, with Nike stores up 6% and Nike Digital down 4%. Wholesale grew 3%. Gross margins expanded 150 basis points to 44.8% on a reported basis, driven by strategic pricing actions, lower ocean freight rates, and improvements in supply chain efficiency, partially offset by higher product input costs. EBIT grew 3% on a reported basis

Going forward, the company see the launch of Air Max Dn, Euro Champs ’24, and the Paris Olympics as opportunities to create near-term brand momentum despite a challenging consumer backdrop. NKE expect Q4 gross margins to expand approximately 150 to 180 basis points.