Summary
Nike, Inc. reported strong performance for the first quarter of fiscal year 2014, with revenues increasing by 8% to $7.0 billion and net income from continuing operations up 33% to $780 million. Diluted earnings per share also saw a significant increase of 37% to $0.86. This growth was driven by broad-based revenue increases across most geographies and product categories, with the NIKE Brand, comprising over 90% of total revenue, showing robust performance, and Converse experiencing an 18% revenue increase. The company highlighted improved gross margins, which expanded by 120 basis points to 44.9%, attributed to lower product costs, a favorable product mix, and growth in the higher-margin Direct to Consumer (DTC) business. While demand creation expenses decreased year-over-year, operating overhead increased due to investments in digital capabilities and DTC expansion. The company also benefited from a lower effective tax rate, contributing to the strong bottom-line results.
Financial Highlights
50 data points| Revenue | $6.97B |
| Cost of Revenue | $3.84B |
| Gross Profit | $3.13B |
| SG&A Expenses | $2.06B |
| Operating Income | $780.00M |
| Net Income | $779.00M |
| EPS (Basic) | $0.44 |
| EPS (Diluted) | $0.43 |
| Shares Outstanding (Basic) | 1.78B |
| Shares Outstanding (Diluted) | 1.82B |
Key Highlights
- 1Revenues increased 8% to $7.0 billion in the first quarter of fiscal year 2014.
- 2Net income from continuing operations rose 33% to $780 million.
- 3Diluted earnings per share from continuing operations grew 37% to $0.86.
- 4Gross margin improved by 120 basis points to 44.9%.
- 5NIKE Brand revenues grew 7% (7% excluding currency), with notable strength in North America and Western Europe.
- 6Converse revenues increased 18% (16% excluding currency).
- 7Direct to Consumer (DTC) revenues grew 18% on a currency-neutral basis, representing 20% of total NIKE Brand revenues.