Nike exceeded analysts predictions in the fourth quarter and fiscal year 2017, reporting fourth quarter revenues up 5 percent to $8.7 billion, and fiscal year 2017 revenues up 6 percent to $34.4 billion.
Fourth quarter diluted earnings per share increased 22 percent to $0.60, due in part to global revenue growth, lower selling and administrative expense, lower tax rate and a lower average share count. This was partially offset by a lower gross margin.
In the fourth quarter, revenues for the Nike brand were $8.1 billion, an increase of 7 percent on a currency neutral basis due in part to double-digit growth in Western Europe, Greater China and the Emerging Markets, and strong growth in sportswear and running sectors.
Converse showed a 10 percent revenue increase to $554 million, due mostly to growth in direct-to-consumer and the Italian market transition.
“Nike continues to create both near-term wins in today’s dynamic environment and a lasting foundation for future growth,” said Mark Parker, Nike chairman, president and CEO. “Through our Consumer Direct Offense, we’re putting even more firepower behind our greatest opportunities in Fiscal 2018. It will be a big year for Nike innovation and we’ll bring those stories to life through deeper consumer connections in our key cities around the world.”
In FY 2017, revenues for the Nike brand increased 8 percent to $32.2 billion. Nike Brand sales increased 5 percent in wholesale sales, while direct-to-consumer revenues increased 18 percent to $9.1 billion, driven by a 30 percent increase in digital commerce sales. Also, the addition of new stores and a 7 percent growth in comparable store sales helped. As of May 31, 2017, the Nike Brand had 985 direct-to-consumer stores in operation, an increase compared to 919 last year.
The FY 2017 net income rose 13 percent to $4.2 billion showing a strong global revenue growth, selling and administrative expense leverage and a lower tax rate, which were somewhat offset by a decline in gross margin. The company reported an inventory increase of 4 percent as of May 31, 2017.