0000320187false00003201872023-12-212023-12-21

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934

December 21, 2023
Date of Report (date of earliest event reported)

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NIKE, Inc.
(Exact name of registrant as specified in its charter)
Oregon
1-1063593-0584541
(State or other jurisdiction of incorporation)
(Commission File Number)
(I.R.S. Employer Identification No.)

ONE BOWERMAN DRIVE
BEAVERTON, OR 97005-6453
(Address of principal executive offices and zip code)

(503) 671-6453
Registrant's telephone number, including area code

NO CHANGE
(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:
Class B Common StockNKENew York Stock Exchange
(Title of each class)(Trading Symbol)(Name of each exchange on which registered)

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.




Item 2.02 Results of Operations and Financial Condition
Today NIKE, Inc. (the “Company”) issued a press release disclosing financial results for the fiscal quarter ended November 30, 2023. The text of the release is furnished herewith as Exhibit 99.1.

Item 2.05 Costs Associated with Exit or Disposal Activities
On December 21, 2023, the Company announced an enterprise initiative designed to accelerate its future growth. The Company is identifying opportunities to deliver up to $2 billion in cumulative cost savings over the next three years, which includes simplifying product assortment, increasing automation and use of technology, streamlining the organization, and leveraging scale to drive greater efficiency. As part of this initiative, on December 21, 2023, the Audit and Finance Committee of the Board of Directors of the Company approved steps to streamline the organization, which are expected to result in restructuring charges of approximately $400 million to $450 million, primarily associated with employee severance costs, to be largely recognized in the third quarter of fiscal year 2024 and to be substantially completed by the end of fiscal year 2024, subject to local law requirements. The expected pre-tax charges are estimates and are subject to a number of assumptions, including local law requirements in various jurisdictions. Actual charges may differ, possibly materially, from the estimates provided above.

Forward-Looking Statements
This Current Report on Form 8-K contains certain statements that constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 and Section 21E of the Exchange Act of 1934, as amended. Forward-looking statements include, without limitation, any statement that may predict, forecast, indicate or imply future results, performance or achievements, and may contain the words “believe,” “anticipate,” “expect,” “estimate,” “project,” “will be,” “will continue,” “will likely result” or words or phrases of similar meaning and include statements regarding the Company’s enterprise initiative, including the benefits thereof and the estimated charges resulting therefrom. Forward-looking statements involve risks and uncertainties which may cause actual results to differ materially from the forward-looking statements. The risks and uncertainties include, among others, the risk that the Company is not able to identify opportunities to deliver anticipated cost savings, risks related to the preliminary nature of the estimate of the charges to be incurred in connection with the enterprise initiative, which is subject to change as the Company refines the estimate over time, risks related to any delays in the timing for implementing the initiative or potential disruptions to the Company’s business or operations as it executes on the initiative, and other factors that may cause the Company to be unable to achieve the expected benefits of the initiative, as well as the risks and uncertainties detailed from time to time in reports filed by the Company with the Securities and Exchange Commission, including reports filed on Forms 8-K, 10-Q and 10-K. The Company disclaims any obligation to update any forward-looking statements contained herein, except as required by law.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits.

The following exhibits are furnished with this Form 8-K:

Exhibit No.Exhibit
99.1
104Cover Page Interactive Data File (embedded within the Inline XBRL document)
SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
   
NIKE, Inc.
(Registrant)
   
Date:
December 21, 2023
By:/s/ Matthew Friend
  Matthew Friend
  Executive Vice President and Chief Financial Officer
   



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Investor Contact:Media Contact:
Paul TrussellVirginia Rustique-Petteni
investor.relations@nike.com
media.relations@nike.com

NIKE, INC. REPORTS FISCAL 2024 SECOND QUARTER RESULTS

BEAVERTON, Ore., Dec. 21, 2023 NIKE, Inc. (NYSE:NKE) today reported fiscal 2024 financial results for its second quarter ended November 30, 2023.

Second quarter revenues were $13.4 billion, up 1 percent on a reported basis compared to the prior year and down 1 percent on a currency-neutral basis*
NIKE Direct revenues were $5.7 billion, up 6 percent on a reported basis and up 4 percent on a currency-neutral basis
NIKE Brand Digital sales increased 4 percent on a reported basis and 1 percent on a currency-neutral basis
Wholesale revenues were $7.1 billion, down 2 percent on a reported basis and down 3 percent on a currency-neutral basis
Gross margin increased 170 basis points to 44.6 percent
Diluted earnings per share was $1.03 for the second quarter, up 21 percent
NIKE, Inc. is announcing an enterprise initiative to accelerate future growth while building a faster, more efficient Nike**

“Our Q2 results demonstrated how we are getting back on our front foot in our key areas of innovation and growth,” said John Donahoe, President & CEO, NIKE, Inc. “This quarter showed strong execution by our team as we focus on our winning formula of innovative product, distinctive storytelling and differentiated marketplace experiences.”**

Matthew Friend, Executive Vice President & Chief Financial Officer, NIKE, Inc. said, “NIKE’s second-quarter financial performance was a turning point in driving more profitable growth. As we look ahead to a softer second-half revenue outlook, we remain focused on strong gross margin execution and disciplined cost management.”**

The Company is identifying opportunities to deliver up to $2 billion in cumulative cost savings over the next three years. Areas of potential savings include simplifying our product assortment, increasing automation and use of technology, streamlining our organization, and leveraging our scale to drive greater efficiency.**

A majority of these savings will be invested to fuel future growth, accelerate innovation at speed and scale, and drive greater long-term profitability.**

As part of this commitment, the Company is taking steps to streamline the organization, which is expected to result in pre-tax restructuring charges of approximately $400 million to $450 million that will largely be recognized in the third quarter of fiscal year 2024, primarily associated with employee severance costs. Revised guidance will be provided on the conference call.**

“We see an outstanding opportunity to drive long-term profitable growth,” said Donahoe. “Today we are embracing a company-wide journey to invest in our areas of greatest potential, increase the pace of our innovation, and accelerate our agility and responsiveness.”**

Second Quarter Income Statement Review

Revenues for NIKE, Inc. increased 1 percent to $13.4 billion compared to the prior year and decreased 1 percent on a currency-neutral basis.
Revenues for the NIKE Brand were $12.9 billion, up 1 percent compared to the prior year and flat on a currency-neutral basis, as currency-neutral growth in APLA and Greater China was offset by declines in North America and EMEA.
Revenues for Converse were $519 million, down 11 percent compared to the prior year and down 13 percent on a currency-neutral basis, due to declines in North America and Europe, partially offset by growth in Asia.
Gross margin increased 170 basis points to 44.6 percent, primarily driven by strategic pricing actions and lower ocean freight rates, partially offset by unfavorable changes in net foreign currency exchange rates and higher product input costs.
Selling and administrative expense increased 1 percent to $4.1 billion.
Demand creation expense was $1.1 billion, up 1 percent, reflecting an increase in marketing expense.
Operating overhead expense was $3.0 billion, flat compared to the prior year as increases in NIKE Direct variable costs were offset by lower technology spend and wage-related expenses.
The effective tax rate was 17.9 percent compared to 19.3 percent for the same period last year.
Net income was $1.6 billion, up 19 percent, and Diluted earnings per share was $1.03, increasing 21 percent.

November 30, 2023 Balance Sheet Review

Inventories for NIKE, Inc. were $8.0 billion, down 14 percent compared to the prior year, reflecting a decrease in units.
Cash and equivalents and short-term investments were $9.9 billion, down approximately $0.7 billion from last year, as cash generated by operations was more than offset by share repurchases, cash dividends, capital expenditures and bond repayment.

Shareholder Returns

NIKE continues to have a strong track record of investing to fuel growth and consistently increasing returns to shareholders, including 22 consecutive years of increasing dividend payouts. In the second quarter, NIKE returned approximately $1.7 billion to shareholders, including:

Dividends of $523 million, up 9 percent from the prior year.
Share repurchases of $1.2 billion, reflecting 11.9 million shares retired as part of the Company’s four-year, $18 billion program approved by the Board of Directors in June 2022. As of November 30, 2023, a total of 65.9 million shares have been repurchased under the program for a total of approximately $7.1 billion.

Conference Call

NIKE, Inc. management will host a conference call beginning at approximately 2:00 p.m. PT on December 21, 2023, to review fiscal second quarter results. The conference call will be broadcast live via the Internet and can be accessed at https://investors.nike.com. For those unable to listen to the live broadcast, an archived version will be available at the same location through approximately 9:00 p.m. PT, January 11, 2024.
About NIKE, Inc.

NIKE, Inc., based near Beaverton, Oregon, is the world's leading designer, marketer and distributor of authentic athletic footwear, apparel, equipment and accessories for a wide variety of sports and fitness activities. Converse, a wholly-owned NIKE, Inc. subsidiary brand, designs, markets and distributes athletic lifestyle footwear, apparel and accessories. For more information, NIKE, Inc.’s earnings releases and other financial information are available on the Internet at https://investors.nike.com. Individuals can also visit https://about.nike.com/en/newsroom and follow @NIKE.
*See additional information in the accompanying Divisional Revenues table regarding this non-GAAP financial measure.
**The marked paragraphs contain forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially. These risks and uncertainties include, among others, the risk that NIKE is not able to identify opportunities to deliver anticipated cost savings, risks related to the preliminary nature of the estimate of the charges to be incurred in connection with the enterprise initiative, which is subject to change as NIKE refines the estimate over time, risks related to any delays in the timing for implementing the initiative or potential disruptions to NIKE’s business or operations as it executes on the initiative, and other factors that may cause NIKE to be unable to achieve the expected benefits of the initiative, as well as the risks and uncertainties detailed from time to time in reports filed by NIKE with the U.S. Securities and Exchange Commission (SEC), including Forms 8-K, 10-Q and 10-K.
(Tables Follow)



NIKE, Inc.
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
THREE MONTHS ENDED%SIX MONTHS ENDED%
(In millions, except per share data)11/30/202311/30/2022Change11/30/202311/30/2022Change
Revenues$13,388 $13,315 %$26,327 $26,002 %
Cost of sales7,417 7,604 -2 %14,636 14,676 %
Gross profit5,971 5,711 %11,691 11,326 %
Gross margin44.6 %42.9 %44.4 %43.6 %
Demand creation expense1,114 1,102 %2,183 2,045 %
Operating overhead expense3,032 3,022 %6,079 5,999 %
Total selling and administrative expense4,146 4,124 %8,262 8,044 %
% of revenues31.0 %31.0 %31.4 %30.9 %
Interest expense (income), net(22)16 — (56)29 — 
Other (income) expense, net(75)(79)— (85)(225)— 
Income before income taxes1,922 1,650 16 %3,570 3,478 %
Income tax expense344 319 %542 679 -20 %
Effective tax rate17.9 %19.3 %15.2 %19.5 %
NET INCOME$1,578 $1,331 19 %$3,028 $2,799 8 %
Earnings per common share:
Basic$1.04 $0.85 22 %$1.99 $1.79 11 %
Diluted$1.03 $0.85 21 %$1.97 $1.77 11 %
Weighted average common shares outstanding:
Basic1,520.8 1,559.0 1,524.6 1,563.1 
Diluted1,532.1 1,572.4 1,537.7 1,579.1 
Dividends declared per common share$0.370 $0.340 $0.710 $0.645 



NIKE, Inc.
CONSOLIDATED BALANCE SHEETS
(Unaudited)
November 30,November 30,% Change
(Dollars in millions)20232022
ASSETS
Current assets:
Cash and equivalents$7,919 $6,490 22 %
Short-term investments2,008 4,131 -51 %
Accounts receivable, net4,782 5,437 -12 %
Inventories7,979 9,326 -14 %
Prepaid expenses and other current assets1,943 2,063 -6 %
Total current assets24,631 27,447 -10 %
Property, plant and equipment, net5,153 4,854 %
Operating lease right-of-use assets, net2,943 2,809 %
Identifiable intangible assets, net269 280 -4 %
Goodwill281 281 %
Deferred income taxes and other assets3,926 3,976 -1 %
TOTAL ASSETS$37,203 $39,647 -6 %
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Current portion of long-term debt$— $500 -100 %
Notes payable-14 %
Accounts payable2,709 2,810 -4 %
Current portion of operating lease liabilities456 426 %
Accrued liabilities5,470 6,020 -9 %
Income taxes payable358 436 -18 %
Total current liabilities8,999 10,199 -12 %
Long-term debt8,930 8,924 %
Operating lease liabilities2,785 2,668 %
Deferred income taxes and other liabilities2,343 2,584 -9 %
Redeemable preferred stock— — — 
Shareholders’ equity14,146 15,272 -7 %
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY$37,203 $39,647 -6 %



NIKE, Inc.
DIVISIONAL REVENUES
(Unaudited)
% Change Excluding Currency Changes1
% Change Excluding Currency Changes1
THREE MONTHS ENDED%SIX MONTHS ENDED%
(Dollars in millions)11/30/202311/30/2022Change11/30/202311/30/2022Change
North America
Footwear$3,757 $3,963 -5 %-5 %$7,490 $7,768 -4 %-3 %
Apparel1,668 1,685 -1 %-1 %3,147 3,179 -1 %-1 %
Equipment200 182 10 %10 %411 393 %%
Total5,625 5,830 -4 %-3 %11,048 11,340 -3 %-2 %
Europe, Middle East & Africa
Footwear2,186 2,063 %%4,446 4,075 %%
Apparel1,200 1,281 -6 %-10 %2,337 2,434 -4 %-7 %
Equipment181 145 25 %18 %394 313 26 %21 %
Total3,567 3,489 %-3 %7,177 6,822 %%
Greater China
Footwear1,361 1,370 -1 %%2,648 2,603 %%
Apparel469 393 19 %24 %870 767 13 %19 %
Equipment33 25 32 %36 %80 74 %12 %
Total1,863 1,788 %%3,598 3,444 %10 %
Asia Pacific & Latin America
Footwear1,303 1,108 18 %15 %2,444 2,172 13 %11 %
Apparel437 435 %-2 %808 848 -5 %-5 %
Equipment65 56 16 %15 %125 114 10 %%
Total1,805 1,599 13 %10 %3,377 3,134 %%
Global Brand Divisions2
12 18 -33 %-41 %25 32 -22 %-25 %
TOTAL NIKE BRAND12,872 12,724 1 %0 %25,225 24,772 2 %2 %
Converse519 586 -11 %-13 %1,107 1,229 -10 %-11 %
Corporate3
(3)— — (5)— — 
TOTAL NIKE, INC. REVENUES$13,388 $13,315 1 %-1 %$26,327 $26,002 1 %1 %
TOTAL NIKE BRAND
Footwear$8,607 $8,504 %%$17,028 $16,618 %%
Apparel3,774 3,794 -1 %-2 %7,162 7,228 -1 %-1 %
Equipment479 408 17 %15 %1,010 894 13 %12 %
Global Brand Divisions2
12 18 -33 %-41 %25 32 -22 %-25 %
TOTAL NIKE BRAND REVENUES$12,872 $12,724 1 %0 %$25,225 $24,772 2 %2 %
1 The percent change has been calculated using actual exchange rates in use during the comparative prior year period and is provided to enhance the visibility of the underlying business trends by excluding the impact of translation arising from foreign currency exchange rate fluctuations, which is considered a non-GAAP financial measure. Management uses this non-GAAP financial measure when evaluating the Company's performance, including when making financial and operating decisions. Additionally, management believes this non-GAAP financial measure provides investors with additional financial information that should be considered when assessing the Company’s underlying business performance and trends. References to this measure should not be considered in isolation or as a substitute for other financial measures calculated and presented in accordance with U.S. GAAP and may not be comparable to similarly titled non-GAAP measures used by other companies.
2 Global Brand Divisions revenues include NIKE Brand licensing and other miscellaneous revenues that are not part of a geographic operating segment.
3 Corporate revenues primarily consist of foreign currency hedge gains and losses related to revenues generated by entities within the NIKE Brand geographic operating segments and Converse, but managed through the Company’s central foreign exchange risk management program.



NIKE, Inc.
EARNINGS BEFORE INTEREST AND TAXES1
(Unaudited)
THREE MONTHS ENDED%SIX MONTHS ENDED%
(Dollars in millions)11/30/202311/30/2022Change11/30/202311/30/2022Change
North America$1,526 $1,497 %$2,960 $2,874 %
Europe, Middle East & Africa927 990 -6 %1,857 1,965 -5 %
Greater China514 511 %1,039 1,052 -1 %
Asia Pacific & Latin America521 485 %935 985 -5 %
Global Brand Divisions2
(1,168)(1,226)%(2,373)(2,413)%
TOTAL NIKE BRAND1
2,320 2,257 3 %4,418 4,463 -1 %
Converse115 153 -25 %282 362 -22 %
Corporate3
(535)(744)28 %(1,186)(1,318)10 %
TOTAL NIKE, INC. EARNINGS BEFORE INTEREST AND TAXES1
1,900 1,666 14 %3,514 3,507 0 %
EBIT margin1
14.2 %12.5 %13.3 %13.5 %
Interest expense (income), net(22)16 — (56)29 — 
TOTAL NIKE, INC. INCOME BEFORE INCOME TAXES$1,922 $1,650 16 %$3,570 $3,478 3 %
1 The Company evaluates the performance of individual operating segments based on earnings before interest and taxes (commonly referred to as "EBIT"), which represents Net income before Interest expense (income), net and Income tax expense. Total NIKE Brand EBIT, Total NIKE, Inc. EBIT and EBIT margin are considered non-GAAP financial measures. Management uses these non-GAAP financial measures when evaluating the Company's performance, including when making financial and operating decisions. Additionally, management believes these non-GAAP financial measures provide investors with additional financial information that should be considered when assessing the Company’s underlying business performance and trends. EBIT margin is calculated as total NIKE, Inc. EBIT divided by total NIKE, Inc. Revenues. References to EBIT and EBIT margin should not be considered in isolation or as a substitute for other financial measures calculated and presented in accordance with U.S. GAAP and may not be comparable to similarly titled non-GAAP measures used by other companies.
2 Global Brand Divisions primarily represent demand creation and operating overhead expense, including product creation and design expenses that are centrally managed for the NIKE Brand, as well as costs associated with NIKE Direct global digital operations and enterprise technology. Global Brand Divisions revenues include NIKE Brand licensing and other miscellaneous revenues that are not part of a geographic operating segment.
3 Corporate consists primarily of unallocated general and administrative expenses, including expenses associated with centrally managed departments; depreciation and amortization related to the Company’s corporate headquarters; unallocated insurance, benefit and compensation programs, including stock-based compensation; and certain foreign currency gains and losses, including certain hedge gains and losses.

v3.23.4
Cover Page Cover Page
Dec. 21, 2023
Cover [Abstract]  
Document Type 8-K
Document Period End Date Dec. 21, 2023
Entity Registrant Name NIKE, Inc.
Entity Incorporation, State or Country Code OR
Entity File Number 1-10635
Entity Tax Identification Number 93-0584541
Entity Address, Address Line One ONE BOWERMAN DRIVE
Entity Address, City or Town BEAVERTON
Entity Address, State or Province OR
Entity Address, Postal Zip Code 97005-6453
City Area Code 503
Local Phone Number 671-6453
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Class B Common Stock
Trading Symbol NKE
Security Exchange Name NYSE
Entity Emerging Growth Company false
Entity Central Index Key 0000320187
Amendment Flag false

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