NYSE:NKE
NIKE, Inc.
A global leader in athletic performance and lifestyle products with a massive brand ecosystem spanning sports, fitness, and everyday wear.
Key Metrics
Investment Thesis
Bull Case
Strong free cash flow generation allows for consistent capital returns via buybacks and dividends, supporting shareholder value even during revenue softness. The direct-to-consumer pivot continues to improve margins and consumer engagement, potentially reversing recent sales trends over time.
Bear Case
The sharp decline in both revenue and net income raises concerns about weakening consumer demand or aggressive cost-cutting measures affecting long-term brand health. High leverage with $7.96B in long-term debt combined with a cash burn from financing activities limits financial flexibility during economic downturns.
About NIKE, Inc.
NIKE, Inc. designs, develops, markets, and sells athletic footwear, apparel, equipment, and accessories globally through direct-to-consumer channels and wholesale partners.
Analysis
Management Discussion
While cash flow from operations remained robust at $3.70B, the company recorded a substantial net decrease in cash of $2.40B driven by aggressive share buybacks ($2.98B) and dividends ($2.30B). The decline in revenue and profit highlights the challenges of maintaining growth in a maturing market despite strong brand loyalty.
Industry Overview
The global athletic apparel industry is highly competitive but consolidates around major players who benefit from economies of scale and exclusive athlete endorsements. Digital transformation remains the primary growth vector as consumers increasingly prefer online shopping over traditional brick-and-mortar retail experiences.
Financial Statements
Income Statement
Balance Sheet
Cash Flow
| Metric | 2023 | 2024 | 2025 |
|---|---|---|---|
| Revenue | $51.22B | $51.36B | $46.31B |
| Cost of Revenue | $28.93B | $28.48B | $26.52B |
| Gross Profit | $22.29B | $22.89B | $19.79B |
| Operating Expenses | $16.09B | $16.19B | $15.90B |
| Operating Income | $6.20B | $6.70B | $3.88B |
| G&A | $12.32B | $12.29B | $11.40B |
| Stock-Based Comp | $755.0M | $804.0M | $709.0M |
| D&A | — | — | $775.0M |
| Depreciation | $703.0M | $796.0M | — |
| Other OpEx | $3.77B | $3.90B | $4.51B |
| Non-Operating Income | $0 | $0 | $0 |
| Interest Income | — | $430.0M | $404.0M |
| Pre-Tax Income | $6.20B | $6.70B | $3.88B |
| Income Tax | $1.13B | $1.00B | $666.0M |
| Continuing Ops | $5.07B | $5.70B | $3.22B |
| Discontinued Ops | $0 | $0 | $0 |
| Net Income | $5.07B | $5.70B | $3.22B |
| Minority Interest | $0 | $0 | $0 |
| Net to Common | $5.07B | $5.70B | $3.22B |
| Metric | 2023 | 2024 | 2025 |
|---|---|---|---|
| Current Assets | $25.20B | $25.38B | $23.36B |
| Cash & Equivalents | $7.44B | $9.86B | $7.46B |
| Accounts Receivable | $4.13B | $4.43B | $4.72B |
| Prepaid Expenses | $1.94B | $1.85B | $2.00B |
| Other Current Assets | $11.69B | $9.24B | $9.18B |
| Long-Term Assets | $12.33B | $12.73B | $13.22B |
| PP&E (Net) | $5.08B | $5.00B | $4.83B |
| Intangibles | $274.0M | $259.0M | $259.0M |
| Goodwill | $281.0M | $240.0M | $240.0M |
| Operating Leases | $2.92B | $2.72B | $2.71B |
| Other LT Assets | $3.77B | $4.51B | $5.18B |
| Total Assets | $37.53B | $38.11B | $36.58B |
| Current Liabilities | $9.26B | $10.59B | $10.57B |
| Accounts Payable | $2.86B | $2.85B | $3.48B |
| Current Debt | $0 | $1.00B | $0 |
| Current Leases | $425.0M | $477.0M | $502.0M |
| Taxes Payable | $240.0M | $534.0M | $669.0M |
| Other Current Liab | $-523.0M | $-557.0M | $-593.0M |
| Long-Term Liabilities | $14.27B | $13.09B | $12.80B |
| Long-Term Debt | $8.93B | $7.90B | $7.96B |
| LT Operating Leases | $2.79B | $2.57B | $2.55B |
| Other LT Liab | $2.56B | $2.62B | $2.29B |
| Total Liabilities | $23.53B | $23.68B | $23.37B |
| Shareholders' Equity | $14.00B | $14.43B | $13.21B |
| Retained Earnings | $1.36B | $965.0M | $-727.0M |
| AOCI | $231.0M | $53.0M | $-258.0M |
| Total L&E | $37.53B | $38.11B | $36.58B |
| Metric | 2023 | 2024 | 2025 |
|---|---|---|---|
| Net Income (CFO) | $5.07B | $5.70B | $3.22B |
| Non-Cash Adjustments | $708.0M | $1.65B | $544.0M |
| Working Capital Changes | $63.0M | $78.0M | $-65.0M |
| Cash from Operations | $5.84B | $7.43B | $3.70B |
| Capital Expenditures | $969.0M | $812.0M | $430.0M |
| Cash from Investing | $564.0M | $894.0M | $-275.0M |
| Share Buybacks | $5.48B | $4.25B | $2.98B |
| Dividends Paid | $2.01B | $2.17B | $2.30B |
| Cash from Financing | $-7.45B | $-5.89B | $-5.82B |
| FX Effect | $-91.0M | $-16.0M | $1.0M |
| Net Change in Cash | $-1.13B | $2.42B | $-2.40B |
| Beginning Cash | $8.57B | $7.44B | $9.86B |
| Ending Cash | $7.44B | $9.86B | $7.46B |
Frequently Asked Questions
How does NIKE, Inc. make money?
Revenue is primarily driven by its Direct-to-Consumer segment including NIKE.com and SNKRS app, alongside Wholesale partnerships with retailers like Foot Locker and Macy's. Product categories focus on the core footwear line (Jordan Brand, Air Max) and apparel collections serving athletes and lifestyle consumers.
What are the main risks for NKE?
Significant year-over-year revenue contraction from $51.36B to $46.31B in 2025 indicates potential demand saturation or macroeconomic sensitivity. A sharp drop in net income from $5.70B to $3.22B suggests rising operating costs or one-time charges impacting profitability. Heavy reliance on wholesale channels exposes the company to retailer inventory cycles and margin compression.
What is NKE's competitive advantage?
Unrivaled brand equity and consumer loyalty create a pricing power that sustains high gross margins above 40%. The company's digital ecosystem and data-driven supply chain allow for rapid trend adaptation and lower inventory risk compared to legacy peers.
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Not financial advice. All content is for informational purposes only. Data may contain errors. Consult a qualified financial advisor before making investment decisions.