Nike released financial results Tuesday from the third quarter of fiscal 2023 that showed revenue rising and net income dropping.
The athletic footwear and apparel company’s third-quarter revenues saw an approximate 14% jump year over year, to $12.39 billion. The company reported $10.87 billion in revenue for the the same three-month period last year.
CFO Matthew Friend said in prepared remarks published by Nike that the company "drove strong holiday sales with momentum continuing into the new calendar year" in North America, where quarterly revenue rose 27%.
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Other regions that saw growth included Europe, the Middle East, Africa, the Asian Pacific and Latin America. The Greater China region, on the other hand, experienced a single-digit revenue decline.
Net income for Nike’s third quarter went from $1.40 billion in fiscal 2022 to $1.24 billion, with its diluted earnings per common share at $0.79. The diluted EPS figure marked a 9% drop year over year.
Revenue and diluted EPS each came in above what analysts had predicted, according to The Associated Press.
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Nike said its gross margin was 43.3%. For the 330 basis point decline in the quarter, the company pointed to "higher markdowns to liquidate inventory; continued unfavorable changes in net foreign currency exchange rates; higher product input costs and elevated freight and logistics costs," according to its earnings release.
The athletic footwear and apparel company’s inventory rose double digits from the $7.7 billion reported in Q3 last year, posting $8.9 billion this year. Friend said in the earnings release that Nike has "made tremendous progress on inventory as we position Nike for sustainable and more profitable growth."
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"Fueled by compelling product innovation, deep relationships with consumers and a digital advantage that fuels brand momentum, our proven playbook allows us to navigate volatility as we create value and drive long-term growth," CEO John Donahoe said.
The company also touted its Nike Direct and Nike Brand Digital sales growth in its earnings release.
