Annual profits

Nike annual profits soar 196%, best in company history

Nike announced its fourth quarter (Q4) and annual performance for the fiscal year ending May 31, 2021 with annual profits up 196% from last year and 42% from 2019, which was before the pandemic. Revenue for the year increased 19% with the fourth quarter (Q4) up 96% which includes March, April and May. John Donahoe, President and CEO of NIKE, Inc., said, “Fiscal 21 (year 2021) has been a pivotal year for NIKE as we have brought our strategy of direct consumer acceleration to life on the market. Building on our momentum, we continue to invest in innovation and digital leadership to lay the foundation for NIKE’s long-term growth.

Nike’s direct sales in its own stores, including digital ones, increased 32%, reaching more than $ 16 billion and accounting for 37% of total revenue. Last year, Nike Direct accounted for 33% of total revenue. Digital growth has reached $ 9 billion in sales and accounts for over 20% of total revenue, and Donahoe is committed to reaching 50% digital business by 2025. Donahoe believes that the priorities for 2022 are in line with the consumer, focusing on both direct-to-consumer and digital strategies (the Consumer Direct Acceleration program), and said during the results call: “This is how we keep one step ahead and increase our lead. “

Gross profit margins increased from 43.4% in 2019 to 44.8% in 2021. Fourth quarter margins were nearly 46% as the company continues to shift more of its business to a direct model to consumers. The increase in wholesale shipments contributed to lower supply chain costs, which positively impacted margins. The main contributors to performance include Nike women’s activity which increased by 22% and the Jordan brand which increased by 31%. Nike’s wholesale business grew 17%. Nike is the world’s largest women’s sports brand with over $ 8.5 billion.

The American market is gaining ground

Retail in the United States sales for the same period of the fourth quarter (March, April and May 2021) increased by 26% less autos and gasoline. Digital sales were up 13%, and clothing, accessories and shoes were up 229% from the same months last year, when many non-essential stores were closed due to the pandemic. Nike’s North American market accounts for 41% of Nike’s global sales and saw a 142% sales increase in the fourth quarter and a 29% increase from 2019. North America digital growth remained strong, with an increase of 54% from the previous year and 177% from the fourth quarter of 2019.

Nike Q3 has been plagued by supply chain issues but Q4 has rebounded strongly

Nike North America third quarter performance was hampered by supply chain issues which drove revenue down 10%. The period, which includes December 2020, January and February 2021, was affected by container shortages, US port congestion and the logistics of inventory flows mainly related to wholesale shipments. Europe, the Middle East and Africa (EMEA) saw a 4% drop in sales linked to the fact that 45% of Nike-owned stores were closed due to the COVID-19 pandemic. The total sales increase for the third quarter was 3%, mainly driven by digital and direct-to-consumer sales.

In the fourth quarter, however, revenue increased 96% from the previous year and 21% from the fourth quarter of 2019. Nike’s direct sales in the fourth quarter increased by 73%. The company closed the year with a strong performance that set the tone for the first quarter of 2022.


Source link

Leave a Reply

Your email address will not be published. Required fields are marked *