Nike Inc (NKE) announced its fiscal year 2021 results after the close of trading on Thursday, exceeding Wall Street’s expectations. Nearly double Nike’s quarterly revenue to $12.34 billion, the highest in its history.
Shares of Nike (NKE) stock surged 14.1% following the close of trading on Thursday as investors lauded the global sportswear leader’s record earnings growth. US-based Nike surpassed sales targets in every major market, including China, defying fears that Chinese consumers would boycott Nike because of tensions between the countries.
Nike stock might hit a new high on Friday if the upside momentum continues.
Although Nike shares are up 33.5% in the past 12 months, they are down 5.56% year-to-date due to investors having concerns about Nike’s position in China, its largest and fastest-growing market.
Nike’s fourth-quarter and full-year results for fiscal 2021 ended May 31 presented a stark contrast to last year when its products were shuttered globally and the demand for its products dropped sharply because of the pandemic and quarantine restrictions.
From March through May, Nike’s worldwide sales reflected deferred consumer demand.
Fourth Quarter 2021 Results
Nike’s earnings per share totaled $0.93 in the fourth quarter, up to $0.43 from analysts’ expectations of $0.50.
For the quarter, the company earned $1.5 billion versus $790 million in a loss in the fourth quarter of 2020.
Nike’s sales grew 95% in the quarter to $12.34 billion, compared to $11.19 billion estimated by analysts.
Geographical Regions Sales
- Sales in North America rose 141% (YoY) to $5.38 billion.
- +124% to $2.98 billion in Europe, Middle East, and Africa
- The Greater China region saw an increase of 17% to $1.93 billion
- The Asia Pacific & Latin America: increased by 82% to $1.46 billion
Fiscal Year 2021 Results
NIKE’s sales increased by 19% to $44.5 billion during the year, while the company’s net income increased by 123% to $5.7 billion. In 2025, the company expects direct sales to account for about 60% of total sales, up from 40% today. Nike had a cash balance of $13.5 billion at the end of the year, up to $4.7 billion from last year.
Future Expectations
Nike expects revenues to exceed $50 billion in fiscal 2022, an increase of about 10%. In addition, management expects to increase profit margins as it sells more products directly to consumers. Nike also expects to see strong sales in China.
