Nike's revenue and market capitalization

  •   DEHOUI Lionel

Nike is an American company specialising in the design, manufacture and sale of sports goods and equipment. It is recognised as the world's leading sports equipment manufacturer. It continues to make its mark in this sector with impressive financial results. Indeed, the group's business has been growing since the beginning of the 2021/2022 financial year. Over the first three quarters of this financial year, the company has posted strong results. Details in the lines to follow.

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Nike's revenue and market capitalization

Reminder of the performance of the 2020/2021 financial year

Nike's 2020/21 financial year took place in a particular context marked by the Covid-19 health crisis. The latter had disrupted the smooth running of several businesses. However, this health situation did not prevent the sporting goods supplier from achieving a good financial performance over the entire financial year.

In the last quarter in particular, the group's business grew remarkably. Its quarterly results exceeded all expectations. At that time, the company's revenues almost doubled to $12.34 billion. Its net profit also improved to $1.51 billion.

In addition, Nike set a new record for sales in the 2020/21 financial year. It was $44.5 billion, up 19% from the previous year.

 

Nike's business update for the first quarter of 2021/2022

In the first quarter of its 2021/2022 fiscal year. Nike delivered a strong financial performance. During this period, the American sporting goods giant generated sales of $12.2 billion, compared to $10.59 billion a year earlier.

This represents an increase of 16% year-on-year. Excluding currency effects, sales rose by 12%. This increase was supported in particular by double-digit growth in Direct Nike. This was achieved in the group's main regions.

Between June and August 2021, the American sports equipment manufacturer posted a net profit of 1.19 billion dollars (or 1.16 dollars per share). It reports 23% growth. In Q1-2021/2022, the company posted a gross margin of 46.5%, an improvement of 1.7 points.

 

Quarterly review in Q2 2021/2022

In the second quarter of 2021/2022 (ending November 2021), Nike delivered strong results. The strong performance noted in this period is further evidence of the Group's strong business momentum since the start of the 2021/2022 financial year.  

Over the whole of Q2 2021/2022, the swoosh brand has seen its revenues grow for the second quarter of affiliation. In fact, between September and November 2021, the group achieved revenues of $11.4 billion, compared to $11.2 billion a year earlier in the same period.

The group's turnover was therefore slightly up by 1% year-on-year. Excluding currency effects, the company's revenues for the quarter were stable. This was due in particular to the offsetting growth of Converse and Nike Direct as a result of the fall in the company's wholesale business.

In addition, for the second quarter of 2021/2022 as a whole, the US group saw its net profit increase by 7% to $1.3 billion. Earnings per share were $0.83. The company's gross margin for the period was 45.9%, an increase of 2.8 percentage points.

 

Performance in the third quarter of 2021/2022

For the full third quarter of 2021/2022 (ending February 2022), Nike's revenue was $10.9 billion, up from $10.35 billion a year earlier. It reported a 5% year-on-year increase. At constant exchange rates, quarterly sales were up 8%.

Also, the turnover came in above market expectations. The market was looking for 10.6 billion dollars. In addition, this growth in the group's revenues for the quarter was helped by the good dynamics of Nike Direct sales. These increased by 17%. 

In North America, group revenues increased by 9% for the full third quarter of 2021/2022. In China, however, billings were down 5% year-on-year. On the other hand, during this period, the brand with the comma saw its digital sales increase by 19%.

This increase was driven by North America, where online sales grew by 33%. For Q3-2021/2022, the world's leading sports equipment maker posted a net profit of $1.4 billion. It declined by 4%.

Earnings per share were 87 cents, down from 90 cents in Q3-2020/21. However, it exceeded market expectations of 71 cents. Gross margin was 46.6%, an improvement of 100 basis points.

 

About Nike's dividend and market capitalisation

The dividend is the share of a company's profits that goes to its shareholders. For several years, Nike has always paid a dividend to its shareholders. This coupon is paid four times a year.

As the year 2022 is still in progress, the sports equipment manufacturer has only paid the dividend once for the time being. The dividend is $0.305 per share. The ex-dividend date is 04 March 2022. The next dividend payment should be made in June 2022.

On the other hand, the sports equipment company has a strong presence on the financial markets. The Nike share is listed on the New York Stock Exchange. As of May 2022, the company has an estimated market capitalisation of $170 billion.

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