Early returns on Nike's controversial Colin Kaepernick ad show that it gave the brand a sales boost. But the company was already riding a hot streak before it debuted on Sept. 3.
Nike on Tuesday reported that revenues in the quarter ending Aug. 31 jumped 10 percent over the year-earlier period to $9.9 billion, driven by double-digit international growth, international performance and what the company characterized as strong momentum in North America. Net income for the period was $1.1 billion, a 15 percent rise over the year-earlier period.
Executives avoided discussing the Kaepernick ad on a conference call until questioned by analysts, and even then CEO Mark Parker avoided mentioning the former San Francisco quarterback by name. But Parker expressed a vote of confidence in the campaign, which was broadly seen as Nike supporting NFL players who kneel during the national anthem to protest social inequities.
"We know it's resonated actually quite strongly with consumers obviously here in North America but also around the world," Parker said on the call.
The campaign, which celebrates Nike's 30th anniversary of "Just Do It," is helping to continue Nike's sales momentum, Parker noted. It includes several athletes. Parker mentioned several by name, including Serena Williams and Odell Beckham Jr., but still avoided naming Kaepernick, who narrates the "Dream Crazy," ad that got the most attention.
Nike has seen "record engagement with the brand as part of the campaign," Parker said on the call. He said it has contributed to driving traffic both socially as well as commercially.
But Nike's stock fell in after hours trading. Bloomberg cited reported gross margins that missed analyst estimates.