Nike sees year-over-year increase in revenue, drop in net income for third quarter

Nike on Tuesday released financial results from the third quarter of fiscal 2023 that showed revenue increased and net income fell.

The athletic footwear and apparel company’s third-quarter revenue saw a roughly 14% year-over-year jump to $12.39 billion. The company reported $10.87 billion in revenue for the same three-month period last year.

Nike released its financial results for the third quarter. (iStock/iStock)

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 include Europe, the Middle East, Africa, Asia Pacific and Latin America. The Greater China region, on the other hand, experienced a single-digit revenue decline.

Nike’s third-quarter net income rose from $1.40 billion in fiscal 2022 to $1.24 billion, with diluted earnings per common share of $0.79. The diluted EPS figure marked a 9% year-over-year drop.

The Nike logo is displayed on a window of a Nike store on March 21, 2019 in San Francisco. (Justin Sullivan/Getty Images/Getty Images)

Revenue and diluted EPS each came in above analysts’ forecasts, 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 write-downs to liquidate inventory; continued unfavorable changes in net foreign currency exchange rates; higher product input costs and increased shipping and logistics costs,” according to the earnings release.

A customer is reflected in a shop window decorated with the Nike logo in the Belaya Dacha outlet village outside Moscow, Russia, April 23, 2016. (REUTERS/Grigory Dukor/Reuters)

The athletic footwear and apparel company’s business rose double-digits from the $7.7 billion reported in the third quarter last year, with $8.9 billion this year. Friend said in the earnings release that Nike has “made tremendous strides in inventory as we position Nike for sustainable and more profitable growth.”

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“Driven by compelling product innovation, deep relationships with consumers and a digital advantage that fuels the brand, our proven playbook allows us to navigate volatility while creating value and driving long-term growth,” said CEO John Donahoe.

The company also presented sales growth for Nike Direct and Nike Brand Digital in its earnings release.