Nike Details Cuts With Earnings Report

Nike Inc. said slumping sales sent fiscal third-quarter earnings plunging 69%--an anticipated result. The Beaverton, Ore.-based athletic shoe and apparel maker also said it plans to take a fourth-quarter charge of $125 million to $175 million and cut 1,600 jobs, or 7% of its work force. Earnings before the charge fell to $73.1 million, or 25 cents a diluted share, down from $237.1 million, or 80 cents, a year earlier. Sales fell 8% to $2.22 billion. Nike had warned last month that earnings would fall and that it planned an unspecified charge because of declining orders from Asian retailers and markdowns on shoes in the U.S. Analysts had expected a larger restructuring charge of $300 million to $500 million and more job cuts, Diane Daggatt of Dain Rauscher said. She said the announced charge does not include an additional $100 million in reserves Nike is taking for inventory write-downs. She said she sees no quick turnaround for the company.