Nike revenues up 10% to $51bn in FY23

Nike has reported a 10% rise in revenues year-on-year to $51.2bn (£40.62bn) and a 16% rise on a currency-neutral basis for the 12 months to 31 May 2023.

Its revenues for the Nike Brand were $48.8bn (£38.66bn) in the period, up 10% on a reported basis and up 16% on a currency-neutral basis, which the brand said was driven by “double-digit growth” across Nike Direct and our wholesale business

Nike Direct generated revenues of $21.3bn (£16.87bn), up 14% on a reported basis and up 20% on a currency-neutral basis, led by Nike Brand Digital growth of 24% and Nike-owned stores growth of 14%.

However, it said its gross margin decreased 250 basis points to 43.5%, primarily due to higher product input costs and elevated freight and logistics costs, higher markdowns and continued unfavourable changes in net foreign currency exchange rates, partially offset by strategic pricing actions.

Selling and administrative expenses also increased 11% to $16.4bn (£12.99bn) and demand creation expense was $4.1bn (£3.24bn), up 5% due to advertising and marketing, and sports marketing expense.

Additionally, operating overhead expense increased 12% to $12.3bn (£1.81bn) primarily due to wage-related expenses, Nike Direct variable costs and higher strategic technology enterprise investments.

It also revealed that net income fell by 16% to $5.1bn (£4.04bn) and diluted earnings per share was $3.23 (£2.56), down 14% compared with the prior year.

Revenues for the fiscal 2023 fourth quarter increased 5% to $12.8bn (£10.15bn) compared with the prior year.

However, gross margin for the quarter decreased 140 basis points to 43.6%.

John Donahoe, president and CEO of NIKE Inc, said: “Nike’s strong results make clear that our strategy is working. FY23 was a milestone year for Nike as our unique advantages continue to drive competitive separation. Our investment in innovation and our digital leadership are fueling broad-based growth across our portfolio of brands, as we create value by serving the future of sport.”

Matthew Friend, executive vice president and CFO, added: “FY23 demonstrated the power of Nike’s portfolio to fuel strong growth, year after year. We finished the year with mid-teens currency-neutral revenue growth and a healthy marketplace — setting the foundation for sustainable, profitable growth in FY24 and beyond.”