US-based multinational sportwear giant Nike Inc has reported an overall increase in revenues of 2 per cent, amounting to $12.9 billion for the first quarter of the fiscal 2024 (Q1 FY24), compared to the previous year.

Specifically, revenues for the Nike Brand were up 3 per cent to $12.4 billion. The increase was mainly driven by currency-neutral growth in Europe, the Middle East, and Africa (EMEA), Greater China, and Asia-Pacific and Latin America (APLA), despite a decline in North American sales, Nike said in a press release.

Nike Direct revenues also saw a bump, going up by 6 per cent to $5.4 billion year-over-year, with growth across all geographies. Digital sales under the Nike Brand marked a modest increase of 2 per cent on both reported and currency-neutral bases. In contrast, wholesale revenues remained almost flat at $7 billion, showing only a slight increase of 1 per cent when accounting for currency-neutral terms.

The Converse brand recorded a decline of 9 per cent in revenues to $588 million in Q1 FY24. The drop was attributed mainly to shrinking sales in North America, although this was partially offset by some growth in Asia.

The gross margin decreased by 10 basis points to 44.2 per cent. This was primarily due to higher product costs and unfavourable changes in foreign currency exchange rates, despite some relief from strategic pricing actions.

Operating expenses also increased in Q1 FY24, with selling and administrative expenses going up by 5 per cent to $4.1 billion. The demand creation expense witnessed a more substantial hike of 13 per cent to $1.1 billion. Operating overhead saw a more modest increase of 2 per cent to $3 billion.

Net income for Q1 FY24 was $1.5 billion, down by 1 per cent, while diluted earnings per share were slightly up by 1 per cent, standing at $0.94.

In terms of inventory, Nike reported a 10 per cent decline to $8.7 billion compared to the prior year.

“Q1 offered proof of what Nike can deliver when we connect great innovation, great storytelling and great marketplace experiences to consumers,” said John Donahoe, president & CEO, Nike. “Moving forward, we are laser-focused on scaling these successes with greater consistency and speed as we continue to integrate and streamline our business. This is how we’ll extend our leadership position and drive growth over the long-term.”

Fibre2Fashion News Desk (DP)

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