Nike Inc. ecommerce sales now represent 27% of total sales. That’s triple the share of total sales since the retailer’s fiscal 2019, according to chief financial officer Matthew Friend.
Friend said on the retailer’s earnings call March 21 for the fiscal third quarter ended Feb. 28, 2023, that Nike Digital sales grew 24%. That, plus 19% growth at Nike physical stores, led to 22% Nike Direct growth.
Nike Digital refers to sales through the retailer’s websites and apps. Nike Direct refers to its direct-to-consumer sales.
Third-quarter total revenue grew to $12.39 billion. That’s up 14% compared with the prior year’s third quarter. Nike Direct sales in the quarter reached $5.3 billion. That’s up 17% year over year.
Digital sales for the retailer’s namesake brand increased 20% year over year. Nike-brand revenue totaled $11.766 billion, with Converse-brand sales accounting for the remaining $612 million.
Nike ranks No. 10 in the Top 1000, Digital Commerce 360’s database of the largest North American e-retailers.
Nike Digital sales breakout by region
Nike Digital sales in North America grew 25%, though the retailer did not provide a dollar amount. That fueled 23% Nike Direct growth as the retailer’s total revenue in the region grew 27% to $4.913 billion. Friend attributed the growth to holiday sales.
Footwear accounted for $3.322 billion in the quarter. That’s up 31% from $2.532 billion in the year-ago quarter.
For the nine months ended Feb. 28, total sales in the region reached $16.253 billion. That’s up 23% from $13.238 billion in the year-ago period.
Europe, Middle East and Africa (EMEA)
Nike Digital sales in the EMEA region grew 42%. Friend attributed that growth to Western European markets, specifically citing the United Kingdom. Nike Direct sales grew 29% in EMEA as the retailer’s total revenue grew 26% in the region to $3.246 billion. That’s up 17% year over year from $2.779 billion.
For the nine months ended Feb. 28, total sales in the region were $10.068 billion. That’s up 9% from $9.228 billion in the same period the year before.
The retailer has lowered fulfillment costs in the region by reducing split shipments and adding pickup points, Friend said.
When it comes to membership and marketing, Friend said, “if we’ve got more members coming in through the top of the funnel who are more engaged and buying more frequently, we should start to see an improvement in our ROAS or return on ad spend from a digital perspective and give us a lot of confidence that we’re building a moat to be able to continue to serve and grow our digital business.”
Nike Digital sales declined 11% in the quarter, though Nike Direct grew 3%. Friend attributed this to consumers shifting back to physical stores as China lifted COVID-19 restrictions. Revenue from the region was $1.994 billion. That’s down 8% from $2.160 billion in the year-ago quarter.
For the nine months ended Feb. 28, total sales in the region were $5.438 billion. That’s down 9% from $5.986 billion in the same period the year before.
This was the market in which Nike sales declined across the board in the third quarter, as well as year to date.
Asia Pacific & Latin America (APLA)
Nike Digital sales grew 23% and Nike Direct 22% as the retailer’s revenue increased 15% in the quarter in APLA.
The retailer’s equipment sales declined to $53 million. That’s down 15% from 63 million in the year-ago quarter. It’s also the only revenue decline in the quarter outside the retailer’s Greater China market.
Revenue in the region totaled $1.601 billion in the retailer’s fiscal third quarter. That’s up 10% from $1.461 billion.
For the nine months ended Feb. 28, total sales in the region were $4.735 billion. That’s up 11% from $4.273 billion in the year-ago period.
Nike Q3 2023 earnings summary
For the fiscal third quarter ended Feb. 28, Nike Inc. reported:
- Third-quarter revenue increased to $12.39 billion. That’s up 14% from $10.87 billion in the previous fiscal third quarter.
- Revenue in North America was $4.91 billion. That’s up 27% from $3.88 billion in the year-ago quarter.
- Nike Direct sales increased 17% to $5.3 billion.
- Nike Digital sales increased 20% and represent 27% of total sales.
For the nine months ended Feb. 28, Nike Inc. reported:
- Total revenue was $38.392 billion. That’s up 11% from $34.476 billion in the year-ago period.
- Total revenue in North America was $16.253 billion. That’s up 23% from $13.238 billion in the year-ago period. It’s also more than 50% greater than the revenue from the retailer’s next-largest market: Europe, Middle East & Africa.
- In EMEA, total revenue grew 9% to $10.068 billion. It was $9.228 billion in the year-ago period.
Percentage changes may not align exactly with dollar figures due to rounding.
Stay on top of the latest developments in the ecommerce industry. Sign up for a complimentary subscription to Digital Commerce 360 Retail News.Favorite