Summary
NIKE, Inc. reported robust financial results for the first quarter of fiscal year 2011, which ended on August 31, 2010. Total revenues increased by 8% to $5.2 billion, and net income saw a 9% rise to $559 million. Diluted earnings per share also grew by 10% to $1.14. This performance was driven by strong demand for NIKE Brand products across most geographies, particularly in North America and Emerging Markets, as well as growth in its 'Other Businesses' segment. The company experienced an improvement in gross margin percentage, attributed to the growth of its Direct-to-Consumer channels, reduced off-price sales, and better in-line product margins.
Financial Highlights
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Financial Statements
Beta
| Revenue | $5.17B |
| Cost of Revenue | $2.74B |
| Gross Profit | $2.43B |
| SG&A Expenses | $1.67B |
| Net Income | $559.00M |
| EPS (Basic) | $0.29 |
| EPS (Diluted) | $0.28 |
| Shares Outstanding (Basic) | 1.92B |
| Shares Outstanding (Diluted) | 1.95B |
Key Highlights
- 1Revenue increased 8% year-over-year to $5.2 billion, indicating strong demand across key markets.
- 2Net income grew 9% to $559 million, with diluted EPS up 10% to $1.14, demonstrating healthy profitability.
- 3Gross margin percentage improved by 80 basis points to 47.0%, driven by Direct-to-Consumer growth and fewer discounted sales.
- 4North America and Emerging Markets showed significant revenue growth, contributing substantially to the overall increase.
- 5Demand creation expenses increased 23% due to marketing initiatives supporting major sporting events like the 2010 World Cup.
- 6The company repurchased approximately $517 million of its common stock during the quarter, underscoring a commitment to shareholder returns.
- 7Futures orders, a key leading indicator, were up 13% excluding currency impacts, signaling continued positive momentum.
Frequently Asked Questions
NIKE reported an 8% increase in revenues to $5.2 billion and a 9% rise in net income to $559 million for the first quarter ended August 31, 2010. Diluted earnings per share also grew by 10% to $1.14.
Revenue growth was primarily driven by strong demand for NIKE Brand footwear and apparel across most geographic segments, with notable contributions from North America and Emerging Markets. Growth in 'Other Businesses' like Converse and Umbro also contributed positively.
The gross margin percentage improved by 80 basis points to 47.0%. This improvement was attributed to the growing contribution of Direct-to-Consumer sales, a reduction in off-price sales as a percentage of total sales, and better in-line product margins.
Worldwide futures and advance orders for NIKE Brand footwear and apparel, scheduled for delivery from September 2010 through January 2011, were up 13% on a currency-neutral basis. This suggests continued strong demand and positive sales momentum.