NIKE, Inc. reported a revenue of $11.6 billion for the first quarter of fiscal 2025, a decrease from $12.9 billion in the first quarter of fiscal 2024. NIKE Direct revenues were $4.7 billion, representing approximately 42% of total NIKE Brand revenues. NIKE Brand wholesale revenues were $6.4 billion, down from $7.0 billion in the first quarter of fiscal 2024.
The gross margin for the first quarter of fiscal 2025 increased by 120 basis points to 45.4%, primarily due to lower product costs, reduced warehousing and logistics costs, and benefits from strategic pricing actions from the prior year. However, inventories as of August 31, 2024, increased by 10% compared to May 31, 2024, primarily driven by an increase in units.
NIKE, Inc. returned approximately $1.8 billion to shareholders in the first quarter of fiscal 2025 through share repurchases and dividends.
The company highlighted several factors impacting its business, including cautious consumer spending, a reduction in certain footwear products, a decline in traffic across NIKE Brand Digital and retail stores, and exposure to risk arising from changes in foreign currency exchange rates.
The company's effective tax rate was 19.6% for the first quarter of fiscal 2025, compared to 12.0% for the first quarter of fiscal 2024, primarily due to a one-time benefit in the first quarter of fiscal 2024 provided by the delay of the effective date of certain U.S. foreign tax credit regulations.
NIKE, Inc. reported that its NIKE Brand revenues decreased 10% on a reported basis and 9% on a currency-neutral basis. The decrease on a currency-neutral basis was due to lower revenues in Men's, Women's, the Jordan Brand, and Kids'. Additionally, NIKE Brand footwear revenues decreased by 10% on a currency-neutral basis, and NIKE Brand apparel revenues decreased by 9% on a currency-neutral basis.
The company's demand creation expense increased by 15%, primarily due to an increase in brand marketing expense, reflecting investment in key sports events. Operating overhead expense decreased by 7% primarily due to lower wage-related expenses and lower other administrative costs.
NIKE, Inc. stated that its effective tax rate was 19.6% for the first quarter of fiscal 2025, compared to 12.0% for the first quarter of fiscal 2024, primarily due to a one-time benefit in the first quarter of fiscal 2024 provided by the delay of the effective date of certain U.S. foreign tax credit regulations. The market has reacted to these announcements by moving the company's shares -0.6% to a price of $80.35. For the full picture, make sure to review NIKE's 10-Q report.
