Nike Conference Call Highlights

Nike

reported its second quarter earnings on Thursday. Shares of the company are down 3%. • NIKE, Inc. revenues increased 15% to $7.4 billion. Gross margin expanded 120 basis points. • Diluted earnings per share increased 25% to $0.74. And we continued to deliver strong returns, as our ROIC reached 27% • Consumers are engaging with technology in new ways. • Going a little bit deeper on e-commerce, it continues to deliver with growth of 65% for the quarter. • Today we have tools and resources available to us that would have been unimaginable five years ago, from 3D printers to high-performance knitting machines to advanced textiles, just to name a few. • On a constant currency basis, NIKE Brand revenue grew 17%. • All geographies grew in the quarter, as did all categories, except Golf. • The NIKE Brand DTC revenue increased 30%, driven by all concepts. Notably, our online business continues to be very strong, with 66% growth in the quarter. • And global futures are up 11%. • In North America, we delivered another great quarter with Q2 revenue growth of 16%. • In Greater China, we continue to see the benefits of our strategy to reset the marketplace. • Q2 revenue growth of 21% reflects our plan to deploy a more consumer-centric distribution strategy. • Which delivered 13% revenue growth in the quarter, every territory except Mexico and Korea, with five of them growing at a double-digit rate. • With revenue up 24% in the quarter, we continue to see strong momentum for the NIKE Brand. • Our DTC business in Western Europe also continues to perform very well, delivering 40% growth in the quarter. • Second quarter reported revenue for NIKE, Inc. increased 15%. On a currency-neutral basis, revenue increased 18%, as the NIKE Brand grew 17% and Converse increased 24%. • Also on a currency-neutral basis, NIKE Brand futures orders grew 11%, driven by a 6% increase in average selling price and a 5% increase in units. • The Q2 effective tax rate was 25.4%. • For the full year, we expect constant dollar revenue growth in the low double-digits, with reported revenue growth two to three points lower.