Nike reports 14% growth in Q3 revenue, earnings drop

The financial results from the third quarter of fiscal 2023 showed revenue rising and net income dropping.

The third quarter revenues of the athletic footwear and apparel company saw an increase of 14% over the past year, to $12.39 billion. The company reported $10.87 billion in revenue for the same three-month period last year.

Europe, the Middle East, Africa, the Asian Pacific and Latin America were the regions that saw growth. The Greater China region, on the other hand, experienced a single-digit revenue decline.

Net income went from $1.40 billion in fiscal 2022 to $1.24 billion in the third quarter, with its earnings per share at $0.79. The diluted EPS figure was a 9% drop over the year.

Revenue and diluted EPS came in above what analysts had predicted, according to The Associated Press.

Nike's gross margin was 43.3%. The company pointed to higher markdowns to liquidate inventory, higher product input costs and higher freight and logistics costs for the quarter, as well as higher markdowns to liquidate inventory, as well as higher net foreign currency exchange rates, and higher product input costs, according to its earnings release.

The company's inventory of athletic footwear and apparel rose double digits from the $7.7 billion reported in Q 3 last year, posting $8.9 billion this year. Friend said in the earnings release that Nike has made great progress on the inventory as we position Nike for sustainable and more profitable growth. MARCH MADNESS: Fueled by compelling product innovation, deep relationships with consumers and a digital advantage that fuels brand momentum, our proven playbook allows us to navigate volatility as we create value and drive long-term growth, CEO John Donahoe said.

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