Nike's Greater China region posts three consecutive quarters of positive growth

American sports brand Nike released its financial report for the fourth quarter and full year of the fiscal year 2023. This report covers the period from June 1, 2022, to May 31, 2023, and shows that Nike's annual revenue for the fiscal year was $51.2 billion (approximately 371.327 billion RMB), representing a 16% year-on-year growth. Additionally, the inventory issue that has been a challenge for almost all sports brands did not pose a problem for Nike. As of the end of the fiscal year 2023, Nike's inventory value remained at $8.5 billion, the same as the previous year. In terms of other brands within the group, Converse achieved annual revenue of $2.427 billion, representing a year-on-year increase of 8%.s

After overcoming the challenges of supply chain shortages in the previous fiscal year, Nike achieved double-digit growth in both its Nike Direct (self-operated) and wholesale businesses in the current fiscal year. Nike's wholesale business generated $27.4 billion in annual revenue, representing a 14% year-on-year growth. Benefiting from the strong performance of Nike's digital brands and its own stores, Nike Direct saw annual revenue of $21.3 billion, a 20% year-on-year increase. The digital transformation driven by Direct-to-Consumer (DTC) has become one of the most important growth drivers for Nike's business. In comparison to its major global competitor, Adidas, the revenue gap between the two companies continued to widen in the most recent fiscal year.

Adidas operates on a fiscal year based on the calendar year. In the most recent fiscal year of 2022, Adidas reported revenue of 22.511 billion euros (approximately 177.4 billion RMB), with a marginal 1% year-on-year increase excluding currency impact. In terms of annual revenue, Nike's global market revenue is already more than double that of Adidas. Furthermore, the gap between the two companies in the Chinese market has widened even further.

In the case of Adidas, its Greater China region recorded a revenue of 3.179 billion euros in 2022, experiencing a 36% year-on-year decline. The revenue in the fourth quarter was even more drastic, with a 50% year-on-year decrease. On the other hand, within Nike's global market segmentation, Greater China remains the third-largest market for Nike worldwide. The region achieved an annual revenue of $7.248 billion, representing a 4% year-on-year growth.

In terms of regional performance, the North American market continues to be Nike's largest contributor with annual revenue of $21.608 billion, representing an 18% year-on-year growth. Following that is the Europe, Middle East, and Africa (EMEA) region, which experienced a 21% increase in revenue to $13.418 billion. The Asia Pacific and Latin America (APLA) region achieved a 17% growth, reaching $6.431 billion in revenue.

Nike's Greater China region recorded a revenue of $1.81 billion in the fourth quarter, representing a 25% year-on-year growth. This marks the third consecutive quarter of positive growth for the region. Sales of footwear, apparel, and equipment products increased by 22%, 36%, and 19% respectively.

Public data shows that in the fiscal year 2023, Nike continues to increase its investment in China. In that year, Nike invested $100 million in China and completed a comprehensive transformation and upgrade of its Nike China logistics center.