Nike Q4 Results: Revenue Down 2% to $12.6Billion, Net Income Up 45% to $1.5Billion

Nike Q4 Results: Revenue Down 2% to $12.6Billion, Net Income Up 45% to $1.5Billion

Nike’s fourth-quarter revenue fell by 2% to $12.6 billion, missing the $12.84 billion expected by analysts. However, net income increased by 45% to $1.5 billion, with diluted earnings per share at 99 cents, surpassing the expected 83 cents per share, despite a 2-cent loss from restructuring charges.

Chief Financial Officer Matthew Friend acknowledged the quarter’s “challenges,” leading to a revised outlook for fiscal year 2025. CEO John Donahoe attributed the guidance cut to weakened lifestyle sales and macroeconomic uncertainties. Nike now expects mid-single-digit revenue declines for fiscal year 2025, with Q1 revenue projected to drop by 10% due to muted wholesale orders and a softer outlook in China.

Following the report, Nike shares fell over 5%t in after-hours trading.

Brand-wise, Nike revenues dropped 1% to $12.1 billion, with growth in Greater China, APLA, and EMEA offset by declines in North America. Converse sales fell 18% to $480 million. Direct revenues decreased by 8% to $5.1 billion, while wholesale revenues rose 5 percent to $7.1 billion.

Market concerns about Nike’s performance persist as the company struggles in key segments like running. In December, Nike announced cost-saving measures, including layoffs and increased automation, aiming to save up to $2 billion over three years. The company also unveiled a new innovation pipeline following criticism over its lack of new products.

Nike’s “Consumer Direct Acceleration” (CDA) program, launched in June 2020, has faced skepticism, with a recent lawsuit alleging executives misled investors about its success.

For fiscal year 2024, Nike reported a 1% increase in both direct and wholesale sales. Overall, revenues reached $51.4 billion, with net income up 12% to $5.7 billion and diluted earnings per share at $3.73, including 22 cents from restructuring charges.

In conclusion, despite current challenges, Nike’s focus on innovation, direct-to-consumer strategies, and organizational streamlining positions the company for future growth.

Financial Summary

Financial MetricQ4 2024Analysts’ ExpectationsFY 2024
Revenue$12.6 billion (down 2%)$12.84 billion$51.4 billion (up 1%)
Net Income$1.5 billion (up 45%)N/A$5.7 billion (up 12%)
Diluted Earnings per Share99 cents83 cents$3.73
Restructuring Charges Impact2 cents loss per shareN/A22 cents
Nike Brand Revenue$12.1 billion (down 1%)N/AN/A
Converse Brand Revenue$480 million (down 18%)N/AN/A
Direct Revenues$5.1 billion (down 8%)N/AN/A
Wholesale Revenues$7.1 billion (up 5%)N/AN/A
Q1 2025 Revenue ProjectionDown 10%N/AN/A
FY 2025 Revenue ProjectionMid-single-digit declineN/AN/A

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