BEAVERTON, Ore., June 24, 2021 — NIKE, Inc. (NYSE:NKE) today reported financial results for its fiscal 2021 fourth quarter and full year ended May 31, 2021.
Source: NIKE, Inc. Reports Fiscal 2021 Fourth Quarter and Full Year Results
$NKE blew beyond analysts’ estimates. I recall discussions stating that Nike removing accounts could be problematic. I stated from day 1 that the moment Nike began to regain control of their product reaching the consumer, they were poised for incredible growth. The big 4th Quarter was due to an increase in wholesale, which seems like more Nike accounts could be better, but the “… fourth quarter revenue growth was led by higher wholesale shipments due to the annualization of COVID-19 related physical retail closures in the prior year in North America, EMEA and APLA.” In other words, the increase in wholesale was due to the supply chain constraints. The interesting thing is now that supply chains are normalizing there are actually Jordans on the walls in sneaker stores. This could be seen as a potential issue, but it isn’t when you consider Nike Direct saw double digit growth.
What do I expect from the Swoosh now? Expect a ramp up of Refurbished. Refurbished has the potential to encroach on the resale market. As Nike begins to capitalize on returns and slightly damaged product, resale platforms like StockX could see their growth slow. The site will have to adjust their hardline stance on Deadstock only footwear, or GOAT will be the beneficiary of resale from Refurbished.
I also see a strong marketing push around the Olympics and following the event. The track and field trials at the University of Oregon were a revelation for the Swoosh and I expect the brand to begin working on Nike sponsored events to continue highlighting the research and development happening in their running performance footwear.
The most obvious prediction is a continued emphasis on the Consumer Direct Acceleration and Edit to Amplify with the Jordan 1, Dunk, and Air Force 1 remaining the primary product drops rolling out throughout the year. “Revenues for the NIKE Brand were $42.3 billion, up 17 percent on a currency-neutral basis, driven by growth across NIKE Direct and wholesale, double-digit growth across footwear and apparel, with growth led by Sportswear and the Jordan Brand.”
“Revenue rose to $12.34 billion from $6.31 billion in the year-ago quarter, when brick-and-mortar stores were shuttered because of the pandemic.” Nike’s goal as stated by Mark Parker four years ago was 50 Billion a year. If they maintain 12.34/quarter they are at 49.36 Billion. That’s incredible.
Want to know the scariest part of this dominance? Nike hasn’t even begun work on integrating a giant segment of their consumer base that isn’t a part of their digital economy, but is a major part of their revenue. If they figure this out you can expect to see more accounts being removed from the bigger account holders. Use the source link at the lead to read more.
