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Double-digit growth for Nike's revenue

Sep 26, 2018 / United States
Double-digit growth for Nike's revenue
The Oregon-based sportswear giant has announced results for the fourth quarter and fiscal 2018. Revenue grew by 13% in the last quarter pf the year. Year closed with a 6% increase in revenue
“Our new innovation is winning with consumers, driving significant momentum in our international geographies and a return to growth in North America”, commented Mark Parker, Chairman, President and CEO, adding: “Fueled by a complete digital transformation of our company end-to-end, this year set the foundation for Nike’s next wave of long-term, sustainable growth and profitability.”

Fourth quarter revenue increased by 13% reaching 9.8 billion US dollars driven by strong double-digit revenue growth in international markets and Nike Direct globally, and a return to growth in North America. Diluted earnings per share for the fourth quarter rose by 15 % reaching 0.69 US dollars, primarily due to strong revenue growth, gross margin expansion, a lower tax rate and a lower average share count, which were partially offset by higher selling and administrative expense.

Revenue for the Nike brand reached 9.3 billion US dollars, up by 9% on a currency-neutral basis, driven by double-digit increases in Nike Direct, international geographies, Sportswear, Global Football and growth in North America. Revenue for Converse totaled 512 million US dollars, down by 14% on a currency-neutral basis, as growth in Asia was more than offset by declines in other territories.

In that same period net income increased by 13% to 1.1 billion US dollars primarily due to strong global revenue growth, gross margin expansion and a lower tax rate, which were partially offset by higher selling and administrative expense, while diluted earnings per share increased by 15% to 0.69 US dollars reflecting a 2% decline in the weighted average diluted common shares outstanding.

Revenue for Nike in fiscal 2018 rose by 6% 36.4 billion US dollars, up by 4% on a currency-neutral basis. On a currency-neutral basis revenue for the Nike brand totaled 34.5 billion US dollars, up by 5%. Nike brand sales to wholesale customers increased by 2% while Nike Direct revenue grew by 12% totaling 10.4 billion US dollars, driven by a 25% increase in digital commerce sales, the addition of new stores and a 4% growth in comparable store sales. Growth was mainly driven by continued strength in international markets and Nike Direct with growth across footwear and apparel and key categories including Sportswear and Nike Basketball. Revenue for Converse totaled 1.9 billion US dollars, down by 11%, as growth in Asia was more than offset by declines primarily in North America.

Net income
decreased by 54% to 1.9 billion US dollars primarily related to the impact of the Tax Act, which offset strong revenue growth. Diluted earnings per share decreased by 53% to 1.17 US dollars, which includes a decline in the weighted average diluted common shares outstanding.

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