Summary
NIKE, Inc. reported a slight increase in revenue for the second quarter of fiscal year 2024, reaching $13.4 billion, a 1% rise on a reported basis and a 1% decrease on a currency-neutral basis. This performance reflects a mixed consumer environment with cautious spending and high promotional activity. The company's direct-to-consumer (DTC) channel showed resilience, with revenues growing 6% and representing approximately 45% of total NIKE Brand revenues. Gross margin improved by 170 basis points to 44.6%, driven by strategic pricing and lower freight costs, though partially offset by foreign currency fluctuations and increased product input costs. While overall revenue growth was modest, the company demonstrated effective cost management, with total selling and administrative expenses remaining stable as a percentage of revenue. NIKE also continued its commitment to returning capital to shareholders, repurchasing shares and issuing dividends. The company announced a significant enterprise initiative in December 2023, which includes streamlining operations and is expected to result in restructuring charges of $400-$450 million, primarily in the third quarter of fiscal 2024.
Financial Highlights
47 data points| Revenue | $13.39B |
| Cost of Revenue | $7.42B |
| Gross Profit | $5.97B |
| SG&A Expenses | $4.15B |
| Net Income | $1.58B |
| EPS (Basic) | $1.04 |
| EPS (Diluted) | $1.03 |
| Shares Outstanding (Basic) | 1.52B |
| Shares Outstanding (Diluted) | 1.53B |
Key Highlights
- 1Revenue increased 1% to $13.4 billion in Q2 FY24, but decreased 1% on a currency-neutral basis, indicating a challenging consumer environment.
- 2NIKE Direct revenue grew 6% to $5.7 billion, representing 45% of total NIKE Brand revenue, highlighting the strength of the company's direct-to-consumer strategy.
- 3Gross margin expanded by 170 basis points to 44.6%, driven by strategic pricing and reduced freight costs, partially offset by currency impacts and higher input costs.
- 4Inventories decreased 6% to $8.0 billion compared to May 31, 2023, indicating effective inventory management.
- 5The company returned approximately $1.7 billion to shareholders in Q2 FY24 through share repurchases and dividends.
- 6A new enterprise initiative was announced, involving streamlining operations and leading to anticipated pre-tax restructuring charges of $400-$450 million.
- 7Footwear revenue was flat on a currency-neutral basis, with strong average selling price (ASP) growth offsetting a 6% decrease in unit sales.