And it did just that. "And there is quite a short list of entities that have been able to achieve that. There you have it. The shares climbed more than 5 per cent in after-hours trading. "Digital is fueling how we create the future of retail. Loyalty membership is also hitting its stride: while the retailer focused on acquisition in quarters past, this quarter Nike reported 70% growth in repeat buying members. While this may not seem significant to some, when dissecting the growth, it becomes much more interesting. Just a quarter earlier, Nike reported a surprise loss of $790 million, as companies were canceling orders of its merchandise and stores in key markets including North America and China were temporarily shut., "Nike is a better, more profitable company today than it was a year ago,"Deutsche Bank analyst PaulTrussell said. Thats informative unto itselfrevenue up in all four regionsbut it doesnt tell us anything about e-commerce versus other sales channels. Marketplace demand continues to significantly exceed available inventory supply.. Enter your email to stay updated with newsletters, event invites & promotions via email from Vogue Business. The outperformance in digital is not just welcomed from a revenue standpoint. Learn more about how Statista can support your business. The sportswear giant alleges streetwear resale marketplace StockX is blatantly freeriding on the back of Nikes trademarks by selling NFTs featuring digital renders of Nike goods. US, Europe slap Russia with luxury sanctions to target oligarchs, Chanel, LVMH, Kering add to brands closing Russia stores, Ralph Lauren sales rise as metaverse investments lure new shoppers. The margin expansion and revenue boost also allowed Nike to raise its dividend for the 19th consecutive year, despite all of the challenges the pandemic presented. Who's Ready for a $192 Per Month Increase to Their Social Security Check? Nike invested in a sneaker launch app SNKRS as early as 2015 and adopted curbside pickup and online-offline product-availability-integrated app in 2018. "Simply put, scale matters, and Nike leads. Lululemon has said that 20% of its second-half 2021 inventory is delayed because of factory closures in Vietnam. Get features designed for better insights. Now, the companys efforts are focused on achieving long-term growth. So we kept reading, and finally found this paragraph tucked away on Page 28: On a reported basis, NIKE Direct revenues represented approximately 40 percent of our total NIKE Brand revenues for the second quarter of fiscal 2021 compared to 33 percent for the second quarter of fiscal 2020. So thats another retailer making the pivot to e-commerce. Given this, Ramirez added that she doesnt predict long-term brand damage for Nike despite short-term revenue challenges. Overview and forecasts on trending topics, Industry and market insights and forecasts, Key figures and rankings about companies and products, Consumer and brand insights and preferences in various industries, Detailed information about political and social topics, All key figures about countries and regions, Everything you need to know about Consumer Goods, Identify market potentials of the digital future, Insights into the world's most important technology markets, Health Market Outlook Consumers are hungry for home-gym accessories and sweat-wicking clothing during the pandemic. The sneaker giant filed its most recent quarterly report on Jan. 5, and all the important numbers on the income statement looked good. Matthew Friend, Nikes evp and CFO, said the retailer has already lost ten weeks of production in Vietnam since July and factory reopenings wont even begin until October, with a ramp to full production over several months [after that]., These delays have caused Nike to re-evaluate its total revenue growth predictions from low double-digit growth to mid-single digits. Moreover, Friend predicted short-term inventory shortages in the marketplace for the next few quarters across all geographies.. The Motley Fool has a disclosure policy. Nike sales rose 5 percent in the three months ended 28 February, outpacing the previous quarters 1 per cent growth, according to a statement on Monday. Leading fashion e-commerce companies worldwide 2021, by market cap, Leading fashion e-commerce companies worldwide 2020-2022, by EV/EBITDA, Leading fashion e-commerce companies worldwide 2019-2021, by CAGR, Leading fashion and apparel websites worldwide 2022, based on visit share. But it has already exceeded that. Digital sales grew by $1.1 billion in the most recent quarter (from $1.3 billion one year ago to $2.4 billion today), and if it werent for that e-commerce growth, total revenue for Nike would have declined from the year-ago period. Thats brought it closer to its customers, Donahoe said. As soon as this statistic is updated, you will immediately be notified via e-mail. That bit about NIKE Direct sounded like a clue to us. Is It a Buy? While Nikes in-store sales havent yet reached pre-pandemic levels, the retailers digital sales continue to grow. Please create an employee account to be able to mark statistics as favorites. Friend said annual sales will increase by mid-single digits over last year, but declined to provide further guidance, given the latest Covid lockdowns. The brand is starting to take what Donahue described as a season-less approach and avoiding heavy discount and promotionally even if the product reaches the market later than we expected.. Use Ask Statista Research Service. First we looked at Nikes segment disclosures. ", "Nike's digitaltransformationstrategyisnoteasilyreplicated," he added. You need at least a Single Account to use this feature. A shift from wholesale distribution to digital sales affects the company's margin profile as well. Discounted offers are only available to new members. For example, he can take his cloud computing know-how from ServiceNow, his payments expertise from PayPal, and his marketplace prowess from eBay to drive success for the sports apparel company. Returns as of 07/30/2022. Not every company has the ubiquitous brand, deep pockets, and strong leadership Nike possesses, but most importantly, the global powerhouse leveraged those advantages to prioritize e-commerce and come out ahead in the past year. Comments, questions or feedback? If you are an admin, please authenticate by logging in again. The company's growth has largely been driven by its back-to-back IP deals, maximizing the strength of its franchises for movie deals and licensing opportunities. After years of struggling, Mattels attempt to turn the business around seems to be bearing fruit. Expenses for shipping and handling returns tend to weigh on total sales, driving profits lower., CFO Matt Friend said Nike typically earns roughly 10 more points toward its gross margins on digital revenue versus wholesale revenue, finding customers on its website are more loyal, allowing Nike to lower customer acquisition costs and increase its return on ad spending., "Whilewewillneedtocontinueinvestmentstoexpanddigitalfulfillmentcapacity,wecanimproveoperationalefficiency throughpredictivemodelingtools,data-drivenmemberpersonalizationandinventorystaging," he said., Nike's net income during the latest period ended Aug. 31 grew to $1.52 billion, or 95 cents per share, from $1.37 billion, or 86 cents per share, a year earlier. One firm taking the right steps seems to be Nike ($NIKE). ecommerceDB.com. Nike chief financial officer Matt Friend said during a call with investors on Monday that nearly all of its suppliers are now operating without restrictions, although it is closely watching the most recent Covid variant. The Motley Fool recommends eBay and recommends the following options: long January 2022 $75.0 calls on PayPal Holdings. Still, that was an improvement on the earlier period. Nike is almost a data-first company, because theyre able to provide the correct product to the right consumer at the right time, in the most convenient way [through targeting], said Jessica Ramirez, a retail analyst at investment research firm Jane Hali & Associates. Still, profit fell 4 per cent for the quarter to $1.4 billion on higher expenses and taxation. The sportswear giant reported a faster pace of sales in its third quarter despite supply chain woes, surprising investors. Volatility profiles based on trailing-three-year calculations of the standard deviation of service investment returns. We did, however, notice this item in the narrative discussion that preceded the table disclosures: The Company's NIKE Direct operations are managed within each NIKE Brand geographic operating segment.. Accessed July 30, 2022. https://www.statista.com/forecasts/1218320/nike-revenue-development-ecommercedb, ecommerceDB.com. Let's dive into the operational changes Nike made, and how they could position the company for an even stronger future. The Motley Fool owns shares of and recommends Nike, PayPal Holdings, and ServiceNow, Inc.. Market-beating stocks from our award-winning analyst team. What's the Lowest Your Social Security Increase Will Likely Be? As one might guess from the name, NIKE Direct is the firms business that sells directly to consumers, both through e-commerce sales and company-owned stores. As a Premium user you get access to the detailed source references and background information about this statistic. Like Nike, Lululemon has watched its digital business explode: Its online sales soared 157% during the latest quarter., To be sure, companies that sell workout apparel like Lululemon and Nike are in many ways just finding themselves in the right spot at the right time. As management itself says, digital sales growth more than offset any physical store sales declines. Nike said revenue accelerated in the third quarter, beating analysts expectations, led by its own retail stores and digital channels, particularly across North America. . "Digital momentum is sticky. As a Premium user you get access to background information and details about the release of this statistic. Making the world smarter, happier, and richer. Nike proved it wasnt immune to supply chain issues last fall, when it warned that factory closures due to Covid-19 and other delays could cause problems with deliveries. ", ecommerceDB.com, E-Commerce net sales of nike.com from 2014 to 2022 (in million US-Dollar) Statista, https://www.statista.com/forecasts/1218320/nike-revenue-development-ecommercedb (last visited July 30, 2022), E-Commerce net sales of nike.com from 2014 to 2022, Global: e-commerce revenue from 2017 to 2025, by segment, Global fashion e-commerce market size 2021-2025, Worldwide online fashion retail revenue 2021-2025, by segment, Online fashion retail revenue change worldwide 2019-2025, by segment, Fashion e-commerce users worldwide 2021-2025, by segment, Online fashion retail revenue worldwide 2019-2025, by region, Online fashion retail revenue worldwide 2022, by country, Fashion e-commerce revenue in Asia 2021-2025, Fashion e-commerce revenue in North America 2021-2025, Fashion e-commerce revenue in Europe 2021-2025, Fashion retail sales channel share worldwide 2022, by region, Fashion: top 5 online stores worldwide in 2021, by net sales, nike.com: E-Commerce net sales from 2014 to 2022, zara.com: E-Commerce net sales from 2014 to 2022, asos.com: E-Commerce net sales from 2014 to 2022, zalando.de: E-Commerce net sales from 2014 to 2022, International site traffic on top fashion websites in select countries worldwide 2021, Increase of site traffic on top fashion websites in select countries 2021, Global online fashion shopping cart abandonment rate 2021, by type, EU consumers who use mobile apps for online shopping purposes 2021, E-commerce penetration rate among active Gen Z users China in 2020, by platform, Global consumers reasons for not liking online shopping 2021, Global consumers reasons for returning clothes bought online 2021, Main online impulse purchases worldwide 2022, by gender, Fashion purchases of consumers in 2020 and 2023, by channel, Usage of online reviews to help with fashion purchases 2021, by country, Share of shoppers buying clothes online after store visit in Europe 2021, by country, Ranking: Top 5 URLs of Amazon.com, Inc., by first-party net sales in 2020, United States: Top 5 online payment methods 2020, United Kingdom: Top 10 Personal Care online stores, United States: Top 5 most used shipping methods 2020, Germany: Top 10 Food & Beverages online stores, United States: Top 5 Pharmacy online stores, Average CPC on search engines 2020, by country, Germany: Top 10 Personal Care online stores, United Kingdom: Top 10 Sports & Outdoor online stores, Germany: Top 10 Sports & Outdoor online stores, Traffic to health disinformation websites vs official health institutions 2019-2020, Global distribution of recovered plastic imports from the U.S. by country 2017/2018, Operating profit of Bioneer Corporation 2015-2021, Size of the global disposable tableware market 2016-2020, Forecast - global software industry revenue 2007-2011, E-Commerce net sales of nike.com from 2014 to 2022 (in million US-Dollar), Find your information in our database containing over 20,000 reports, Find a brief overview of all Outlooks here, Tools and Tutorials explained in our Media Centre, Immediate access to statistics, forecasts, reports and market outlooks, Detailed source and background information. Even more encouraging, these numbers would have actually been better if not for global container shortages that affected inventory shipments. Walmart announced Wednesday it plans tohire 20,000 seasonal employees during the holidays to help pack and ship online purchases in its fulfillment centers. Invest better with The Motley Fool. Budrul Chukrut | SOPA Images | Getty Images, Outlook for Nike positive, with less competition out of pandemic: Analyst, Nike's digital sales soared 82% during the fiscal first quarter, Even as most of its stores were reopened, Nike's digital sales soared 82% during the fiscal first quarter., The company is on track to have its digital sales represent 50% of total revenue in coming years., Nike said its online sales are more profitable than sales in wholesale channels, like department stores., "Digital is fueling how we create the future of retail," CEO John Donahoe said.. Down 36%, Investors Should Buy the Dip on This Best-In-Class Retail Stock, 1 CFO Isn't Worried About the Economy (Yet). Nike or Lululemon Athletica: Which Stock Is a Screaming Buy Right Now? Please do not hesitate to contact me. We are focused on what we can control, while there are several new dynamics creating levels of volatility. He noted Nike stores and e-commerce operations remain paused in Russia and Ukraine as the war continues, though both account for less than 1 per cent of total sales. ", Nike, which has a market cap of $199.4 billion, has watched its shares rally more than 15% this year.. You can unsubscribe at any time. Figure 1, below, shows lots of geographic segments. ", For many retailers, not just Nike, e-commerce is fueling gains, even driving hiring. Indeed, Nike has been investing in digital shopping long before the pandemic, often as a first-mover in new technology. With so much disruption to the iconic brand's business model, it had to be flexible and creative to continue delivering for shareholders in the new environment. Today, were in a stronger position relative to our competition than we were prior to the pandemic, said Nike President and CEO John Donahoe. That Big Goodwill Impairment You May Have Missed, Digging Into Deltas Revenues, Efficiency, filed its most recent quarterly report on Jan. 5, retailers making a pivot into e-commerce sales. In its latest earnings, PepsiCo emphasized its commitment to shape its beverage portfolio to reflect modern consumers' lesser-than-sweet tastes. Sign up to our newsletter for a truly global perspective on the fashion industry. However, strict Covid-19 regulations in Vietnam where half of Nikes footwear is currently manufactured took their toll this quarter, and mean that future stockout strain is likely for the holiday season. Still, Nike expects delivery delays will continue, with transit times particularly high in the key North American market. Advertising and promotions expenses spiked 20 per cent in the quarter to $854 million. Then you can access your favorite statistics via the star in the header. September 21, 2021. With that in mind, a lasting shift to digital business could create a permanent boost to the company's profits. All Rights Reserved. Its since closed the gap on losses in China, which fell as much as 25 per cent last year, and returned to growth in other Asia-Pacific regions and Latin America. Profit from the additional features of your individual account. Register in seconds and access exclusive features. Deft footwork, indeed. Revenue up 8.8 percent from the year-ago period to $11.24 billion; pre-tax income up 16.5 percent to $1.45 billion. Facebook: number of monthly active users worldwide 2008-2022, Smartphone market share worldwide by vendor 2009-2022, Number of apps available in leading app stores Q1 2022, Profit from additional features with an Employee Account. Learn More. On a currency-neutral basis, NIKE Direct revenues increased 30 percent, driven by digital sales growth of 80 percent, which more than offset comparable store sales declines of 4 percent primarily due to reduced physical retail traffic, in part resulting from safety-related measures in response to COVID-19. To use individual functions (e.g., mark statistics as favourites, set Despite massive supply chain delays after factory closures in Indonesia and Vietnam, Nikes digital sales continue to drive overall revenue growth. Calculated by Time-Weighted Return since 2002. The company's priorities are its three pillars: sparkling water, energy and sports drinks, along with ready-to-drink coffee. This is undeniably positive, and there is likely a runway for further expansion as management expects digital to make up 30% of the business by fiscal 2023. Globally, the retailer drove a 25% currency-neutral growth in its digital channels sales and digital is now 21% of Nikes total revenue, up from 19% of total revenue the year prior. To receive the Vogue Business newsletter, sign up here. Sign up for free newsletters and get more CNBC delivered to your inbox, Get this delivered to your inbox, and more info about our products and services., 2022 CNBC LLC. Moreover, Nike is attempting to digitize its supply chain, leveraging consumer data to predict future supply needs. In the company's most recent quarter (ended Feb. 28), total sales rose 3% year over year. Third-quarter sales hit $10.9 billion, with direct retail (including Nike stores and its e-commerce site) up 15 per cent to $4.6 billion and digital sales up 19 per cent. Each direct-to-consumer sale gives Nike greater visibility into consumer data, allowing it to control inventory more effectively. (Nike also has a wholesale operation where it sells its gear to other retailers like Footlocker ($FL), for example.). Youre reading a free article with opinions that may differ from The Motley Fools Premium Investing Services. And Friend "continues to see the value of a more direct, digitally-enabled strategy fueling ever greater potential over the long term.". Nike is focusing on direct-to-consumer sales, cutting wholesale accounts and investing more in its own stores, sites and apps. Incorporated in this definition are purchases via desktop computer (including notebooks and laptops) as well as purchases via mobile devices such as smartphones and tablets.The following are not included in the e-commerce market: marketplace platforms only, digitally distributed services (e.g. The e-commerce market encompasses the sale of physical goods via a digital channel to a private end user (B2C). Nike [is trying] to future proof their brand.. Why? Bradley Freeman has no position in any of the stocks mentioned. In response, the Nike team is moving production away from Vietnam to Indonesia and China and leveraging airfreight when possible. Vogue Business Fashion's Global Perspective, Designer and influencer Alexa Chung to close her fashion label, Bleak outlook for luxury sector in global lockdown, Nike revenue dips 1% as sales slow in China, US, Index: Brands are better prepared for a second lockdown, Enter your email to stay updated with newsletters, event invites & promotions via email from, acquiring digital fashion marketplace RTFKT. Get full access to all features within our Corporate Solutions. [And] Nike has embraced the structural shift of consumer shopping habits from traditional brick-and-mortar to digital and will, in our view, continue to capitalize on this shift. travel tickets), online stores dedicated to digital media downloads or streams as well as online stores dedicated to B2B markets nor sales between private persons (C2C). They're shopping for leggings and sweatpants to lounge in and wear while working from home. Please see our privacy policy for more information. Nikes strong results this quarter show that our consumer direct acceleration strategy is working, as we invest to achieve our growth opportunities, said Nike CEO John Donahoe in a statement. Nike has also spent time and money in the metaverse, rolling out Nikeland, a digital world on Roblox, and acquiring digital fashion marketplace RTFKT to create Nike Virtual Studios, with which it plans to build Web3 products and experiences, said Donahoe. Stock Advisor list price is $199 per year. Given how Nike outperformed many of its competitors during the pandemic, Donahoe seemed to handle his tumultuous first year quite well. "E-Commerce net sales of nike.com from 2014 to 2022 (in million US-Dollar)." Our third quarter results demonstrate Nikes ability to navigate through volatility, while continuing to serve consumers directly and digitally, at scale, said Friend. Research financial & accounting data like never before. In, ecommerceDB.com. OK, but exactly what is Nike doing to get these numbers? Except, the $4.31 billion in that line item still combines both e-commerce and company-owned stores. Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services. Digital sales were $2.4 billion for the second quarter of fiscal 2021 compared to $1.3 billion for the second quarter of fiscal 2020. Nike Is the Worst Performing Dow Stock in 2022.
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