Nike (NKE) reported better-than-expected third-quarter results. The athletic apparel retailer posted adjusted earnings per share of $0.77 compared to a $0.74 estimate. Revenue of $12.43 billion topped expectations of $12.31 billion. Gross margin of 44.8% was just shy of the 45.1% estimate, while Greater China revenue of $2.08 billion was about in line with the estimate of $2.04 billion.

Yahoo Finance's Julie Hyman and Josh Lipton break down the report.

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Editor's note: This article was written by Stephanie Mikulich.

Video Transcript

JULIE HYMAN: Take a look at shares of Nike now. That company reporting its fiscal third quarter results. The shares up by about 4.5%. And that's as a Nike reports revenue of $12.4 billion, that's versus the $12.31 billion that analysts had been anticipating.

Earnings per share at $0.77. It looks like that is above what analysts had been anticipating as well. Gross margin, a little bit shy here at 44.8%, 45.1% is what analysts had been anticipating there.

And finally, greater China revenue, which always gets a lot of attention. $2.08 billion roughly in line to slightly better than what analysts had been anticipated. Anticipating John Donahoe the CEO of Nike talking about making the necessary adjustments to drive Nike's next chapter of growth.

Nike's been sort of trying to right size its strategy with where it sells its merchandise, what channels does it use. It is really bulk up. Its direct to consumer over the past few years.

But it still seems to be figuring out, Josh. It's sort of like Dick's Sporting Goods, Foot Locker department store, what the right balance is.

JOSH LIPTON: Yeah, it's been tough going for Nike. I mean, heading into this report, the stock was really beaten down. I mean, it was about down 10% this year. It was down about 20% over the past 12 months.

Some questions about-- I know analysts have raised about leadership and new product on the way, as well as competition in China for sure.

JULIE HYMAN: Yeah, most definitely. So all of this playing out as we see the shares. Even as we talk sort of cut that first blush increase reaction that we saw.