NIKE, Inc. reported its financial results for the second quarter of fiscal 2025, revealing a decrease in revenues from $13.4 billion in the second quarter of fiscal 2024 to $12.4 billion in the same period of fiscal 2025. This represents an 8% decline in revenues. The company's NIKE Direct revenues also decreased from $5.7 billion in the second quarter of fiscal 2024 to $5.0 billion in the second quarter of fiscal 2025, representing a 12% decline. NIKE Brand wholesale revenues also experienced a decline from $7.1 billion in the second quarter of fiscal 2024 to $6.9 billion in the second quarter of fiscal 2025, marking a 3% decrease.
The gross margin for the second quarter of fiscal 2025 decreased by 100 basis points to 43.6%, primarily due to higher discounts and changes in channel mix, partially offset by lower product input costs as well as lower warehousing and logistics costs. The company's inventories as of November 30, 2024, increased by 6% compared to May 31, 2024, primarily driven by an increase in units.
NIKE, Inc. returned approximately $1.6 billion to its shareholders in the second quarter of fiscal 2025 through share repurchases and dividends.
The company's results for the second quarter and six months ended November 30, 2024, reflect lower wholesale shipments, increased sales-related reserves, a decrease in traffic, and elevated promotional activity across NIKE Direct, which resulted in a negative impact on revenues and overall profitability.
NIKE is taking actions across various areas, including product management, marketplace management, and brand management. These actions are aimed at repositioning the business, and it is expected that they will result in a negative impact on revenues and gross margin as well as higher demand creation expense. However, the company believes these actions will reposition its business to drive long-term shareholder value.
In terms of non-GAAP financial measures, NIKE, Inc. reported an Earnings Before Interest and Taxes (EBIT) of $1.392 billion for the second quarter of fiscal 2025, a decrease from $1.900 billion in the second quarter of fiscal 2024. The EBIT margin for the second quarter of fiscal 2025 was 11.3%, down from 14.2% in the second quarter of fiscal 2024.
Currency-neutral revenues for the company decreased by 9% for the second quarter of fiscal 2025, primarily due to lower revenues in North America, Europe, Middle East & Africa, Greater China, and Converse. NIKE Brand revenues, which represented over 90% of NIKE, Inc. revenues, decreased by 7% on a reported basis and 8% on a currency-neutral basis.
The company's gross profit decreased by 10% to $5.389 billion for the second quarter of fiscal 2025, with a gross margin of 43.6%, representing a decrease of 100 basis points compared to the same period in the previous year.
Following these announcements, the company's shares moved -0.5%, and are now trading at a price of $73.31. If you want to know more, read the company's complete 10-Q report here.
