NIKE Reports Fiscal 2024 First Quarter Results

30 September 2023, Mumbai

Key Highlights

Revenues increased 2% to $12.9 billion on a reported and currency-neutral basis.

NIKE Direct revenues increased 6% on a reported and currency-neutral basis.

NIKE Brand Digital sales increased 2% on a reported and currency-neutral basis.

Gross margin decreased 10 basis points to 44.2%.

Diluted earnings per share was $0.94, up 1%.

Management Commentary

John Donahoe, President & CEO: "Q1 offered proof of what NIKE can deliver when we connect great innovation, great storytelling and great marketplace experiences to consumers."

Matthew Friend, Executive Vice President & Chief Financial Officer: "Our first-quarter results demonstrated the impact of staying on the offense over the past fiscal year. With a healthy marketplace and another quarter of brand and business momentum, we are strengthening our foundation for sustainable, profitable, long-term growth."

Financial Review

Revenues for the NIKE Brand were $12.4 billion, up 3% on a reported and currency-neutral basis, led by currency-neutral growth in EMEA, Greater China and APLA, partially offset by a decline in North America.

Revenues for Converse were $588 million, down 9% on a reported and currency-neutral basis, due to a decline in North America, partially offset by growth in Asia.

Gross margin decreased 10 basis points to 44.2%, primarily driven by higher product costs and unfavorable changes in net foreign currency exchange rates, largely offset by strategic pricing actions.

Selling and administrative expense increased 5% to $4.1 billion.

Demand creation expense was $1.1 billion, up 13%, primarily due to advertising and marketing expense.

Operating overhead expense increased 2% to $3.0 billion, primarily due to wage-related expenses and NIKE Direct variable costs, partially offset by lower technology spend.

The effective tax rate was 12.0 percent compared to 19.7 percent for the same period last year primarily due to a one-time benefit provided by the recent delay of the effective date of U.S. foreign tax regulations.

Net income was $1.5 billion, down 1%, and diluted earnings per share was $0.94, increasing 1%.

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