- Second quarter revenues were $12.4 billion, down 8 percent on a reported basis compared to the prior year and down 9 percent on a currency-neutral basis*
- NIKE Direct revenues were $5.0 billion, down 13 percent on a reported basis and down 14 percent on a currency-neutral basis
- Wholesale revenues were $6.9 billion, down 3 percent on a reported basis and down 4 percent on a currency-neutral basis - Gross margin decreased 100 basis points to 43.6 percent
- Diluted earnings per share was $0.78
"After an energizing 60 days of being back with my NIKE teammates, our clear priority is to return sport to the center of everything we do," said Elliott Hill, President & CEO, NIKE, Inc. "We're taking immediate action to reposition our business, so we can get back to driving long-term shareholder value. Our team is ready to go, and I'm confident you will see more moments of NIKE being NIKE again."
"NIKE's second-quarter financial performance largely met our expectations, as we continue to make progress in shifting our portfolio," said Matthew Friend, Executive Vice President and Chief Financial Officer, NIKE, Inc. "Under Elliott's leadership, we are accelerating our pace and reigniting brand momentum through sport."
Second Quarter Income Statement Review
- Revenues for NIKE, Inc. were $12.4 billion, down 8 percent on a reported basis compared to the prior year and down 9 percent on a currency-neutral basis.
- NIKE Brand revenues were $12.0 billion, down 7 percent on a reported basis and down 8 percent on a currency-neutral basis, driven by declines across all geographies.
- NIKE Direct revenues were $5.0 billion, down 13 percent on a reported basis and down 14 percent on a currency-neutral basis, primarily due to a 21 percent decrease in NIKE Brand Digital and a 2 percent decrease in NIKE-owned stores.
- Wholesale revenues were $6.9 billion, down 3 percent on a reported basis and down 4 percent on a currency-neutral basis.
- Revenues for Converse were $429 million, down 17 percent on a reported basis and down 18 percent on a currency-neutral basis, due to declines across all territories.
- Gross margin decreased 100 basis points to 43.6 percent, primarily due to higher discounts and changes in channel mix, partially offset by lower product input costs as well as lower warehousing and logistics costs.
- Selling and administrative expense decreased 3 percent to $4.0 billion.
- Demand creation expense was $1.1 billion, up 1 percent, primarily due to an increase in sports marketing expense offset by a decrease in brand marketing expense.
- Operating overhead expense decreased 5 percent to $2.9 billion, due to lower wage-related expenses and lower other administrative costs.
- The effective tax rate was 17.9 percent compared to 17.9 percent for the same period last year.
- Net income was $1.2 billion, down 26 percent, and Diluted earnings per share was $0.78, a decrease of 24 percent.
November 30, 2024 Balance Sheet Review
- Inventories for NIKE, Inc. were $8.0 billion, flat compared to the prior year, reflecting an increase in units offset by lower product input costs and product mix shifts.
- Cash and equivalents and short-term investments were $9.8 billion, down approximately $0.2 billion from last year, as cash generated by operations was more than offset by share repurchases, cash dividends and capital expenditures.
Shareholder Returns
NIKE continues to have a strong track record of consistently increasing returns to shareholders, including 23 consecutive years of increasing dividend payouts.
In the second quarter, the Company returned approximately $1.6 billion to shareholders, including:
- Dividends of $557 million, up 7 percent from the prior year.
- Share repurchases of $1.1 billion, reflecting 13.1 million shares retired as part of the Company's four-year, $18 billion program approved by the Board of Directors in June 2022.
As of November 30, 2024, a total of 112.8 million shares have been repurchased under the program for a total of approximately $11.3 billion.
Conference Call
NIKE, Inc. management will host a conference call beginning at approximately 2:00 p.m. PT on December 19, 2024, to review fiscal second quarter results. The conference call will be broadcast live via the Internet and can be accessed at https://investors.nike.com. For those unable to listen to the live broadcast, an archived version will be available at the same location through approximately 9:00 p.m. PT, January 10, 2025.
About NIKE, Inc.
NIKE, Inc., based near Beaverton, Oregon, is the world's leading designer, marketer and distributor of authentic athletic footwear, apparel, equipment and accessories for a wide variety of sports and fitness activities. Converse, a wholly-owned NIKE, Inc. subsidiary brand, designs, markets and distributes athletic lifestyle footwear, apparel and accessories. For more information, NIKE, Inc.'s earnings releases and other financial information are available on the Internet at https://investors.nike.com. Individuals can also visit https://news.nike.com and follow @NIKE.
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