01—Abstract
Summary
Summary of the 10-K filed July 23, 2019. Cited figures are marked; the original filing is the authoritative source.
NIKE, Inc.'s 2019 10-K filing highlights a year of robust revenue growth, with total revenues reaching $39.1 billiona, a 7% increase year-over-year.
This growth was primarily driven by an 11%b increase in NIKE Brand revenues, with strong performance across all geographic segments and a significant surge in digital commerce, which grew by 35%. The company is executing its 'Consumer Direct Offense' strategy, focusing on innovation, speed to market, and direct consumer connections, with ambitious financial goals through fiscal year 2023 including high single-digit revenue growth and mid-teens earnings per share growth. The company demonstrated improved profitability, with gross margin expanding by 90 basis points to 44.7%, attributed to higher average selling prices and growth in the higher-margin NIKE Direct business.
Despite increased investments in digital capabilities and enterprise resource planning tools, income before income taxes rose by 11%. NIKE also continued its capital return program, repurchasing $4.3 billionc in shares during fiscal 2019 and initiating a new $15 billion share repurchase program.
02—Key points
Key Highlights
- Total revenues reached $39.1 billion, up 7% year-over-year, driven by strong NIKE Brand performance.
- NIKE Brand revenues increased 11% on a currency-neutral basis, showcasing broad-based growth across categories and geographies.
- NIKE Direct sales, particularly digital commerce, experienced robust growth, increasing 16% currency-neutral and 35% on a reported basis.
- Gross margin improved by 90 basis points to 44.7%, supported by higher average selling prices and the growing NIKE Direct channel.
- Income before income taxes increased by 11%, despite increased investments in digital transformation and brand campaigns.
- The company completed a $12 billion share repurchase program and initiated a new $15 billion program, demonstrating commitment to shareholder returns.
- Geographically, Greater China showed exceptional growth, with revenue up 24% currency-neutral, followed by EMEA (11% currency-neutral) and North America (7% currency-neutral).
03—One dollar
04—Financials
Financial Highlights
Figures from 10-KFY2019filed July 23, 2019Financial Statements
FY2019 against FY2018
| Line item | FY2019FY2018 | Change |
|---|---|---|
| Revenue | $39.12B$36.40B | +7.5% |
| Cost of Revenue | $21.64B$20.44B | +5.9% |
| Gross Profit | $17.47B$15.96B | +9.5% |
| SG&A Expenses | $12.70B$11.51B | +10.3% |
| Net Income | $4.03B$1.93B | +108.4% |
| EPS (Basic) | $2.55$1.19 | +114.3% |
| EPS (Diluted) | $2.49$1.17 | +112.8% |
| Shares Outstanding (Basic) | 1.58B1.62B | −2.7% |
| Shares Outstanding (Diluted) | 1.62B1.66B | −2.5% |
05—Questions
Frequently Asked Questions
What was NIKE's overall revenue performance in fiscal year 2019?
NIKE reported total revenues of $39.1 billion for fiscal year 2019, representing a 7% increase compared to the prior year. This growth was primarily driven by the NIKE Brand, which saw an 11% increase on a currency-neutral basis.
How did NIKE's digital sales perform in fiscal year 2019?
NIKE's digital commerce sales showed strong performance, growing by 35% on a reported basis and 16% on a currency-neutral basis, contributing significantly to the overall growth of the NIKE Direct business.
What is NIKE's strategy for future growth?
NIKE is executing its 'Consumer Direct Offense' strategy, aiming to double the impact of innovation, increase speed to market, and grow direct connections with consumers. The company has set financial goals for high single-digit revenue growth and mid-teens earnings per share growth through fiscal year 2023.
How is NIKE returning value to shareholders?
In fiscal year 2019, NIKE completed a $12 billion share repurchase program and initiated a new $15 billion share repurchase program, demonstrating a commitment to returning capital to shareholders.
06—Continue