《耐克公司NIKE Inc. (NKE) 2024財年第二季度財報（英文版）（71頁）.pdf》由會員分享，可在線閱讀，更多相關《耐克公司NIKE Inc. (NKE) 2024財年第二季度財報（英文版）（71頁）.pdf（71頁珍藏版）》請在三個皮匠報告上搜索。

1、UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington,D.C.20549FORM 10-Q(Mark One)QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D)OF THE SECURITIES EXCHANGE ACT OF 1934FOR THE QUARTERLY PERIOD ENDED NOVEMBER 30,2023OR TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D)OF THE SECURITIES EXCHANGE AC

2、T OF 1934FOR THE TRANSITION PERIOD FROM TO .Commission File No.1-10635NIKE,Inc.(Exact name of Registrant as specified in its charter)Oregon93-0584541(State or other jurisdiction of incorporation or organization)(I.R.S.Employer Identification No.)One Bowerman Drive,Beaverton,Oregon 97005-6453(Address

3、 of principal executive offices and zip code)(503)671-6453(Registrants telephone number,including area code)SECURITIES REGISTERED PURSUANT TO SECTION 12(B)OF THE ACT:Class B Common StockNKENew York Stock Exchange(Title of each class)(Trading symbol)(Name of each exchange on which registered)Indicate

4、 by check mark:YESNOwhether the registrant(1)has filed all reports required to be filed by Section 13 or 15(d)of the Securities Exchange Act of 1934 during the preceding12 months(or for such shorter period that the registrant was required to file such reports),and(2)has been subject to such filing r

5、equirements for thepast 90 days.whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T(232.405 of this chapter)during the preceding 12 months(or for such shorter period that the registrant was required to submit

6、 such files).whether the registrant is a large accelerated filer,an accelerated filer,a non-accelerated filer,a smaller reporting company,or an emerging growth company.See the definitions of large accelerated filer,accelerated filer,smaller reporting company,and emerging growth company in Rule 12b-2

7、 of the Exchange Act.Large accelerated filerAccelerated filer Non-accelerated filerSmaller reporting companyEmerging growth companyif an emerging growth company,if the registrant has elected not to use the extended transition period for complying with any new or revised financialaccounting standards

8、 provided pursuant to Section 13(a)of the Exchange Act.whether the registrant is a shell company(as defined in Rule 12b-2 of the Act).As of December 28,2023,the number of shares of the Registrants Common Stock outstanding were:Class A297,897,252 Class B1,217,224,816 1,515,122,068 Table of ContentsNI

9、KE,INC.FORM 10-QTABLE OF CONTENTSPAGEPART I-FINANCIAL INFORMATION1ITEM 1.Financial Statements1Unaudited Condensed Consolidated Statements of Income1Unaudited Condensed Consolidated Statements of Comprehensive Income2Unaudited Condensed Consolidated Balance Sheets3Unaudited Condensed Consolidated Sta

10、tements of Cash Flows4Unaudited Condensed Consolidated Statements of Shareholders Equity5Notes to the Unaudited Condensed Consolidated Financial Statements7ITEM 2.Managements Discussion and Analysis of Financial Condition and Results of Operations23ITEM 3.Quantitative and Qualitative Disclosures abo

11、ut Market Risk43ITEM 4.Controls and Procedures43PART II-OTHER INFORMATION45ITEM 1.Legal Proceedings45ITEM 1A.Risk Factors45ITEM 2.Unregistered Sales of Equity Securities and Use of Proceeds46ITEM 5.Other Information47ITEM 6.Exhibits48Signatures49Table of ContentsPART I-FINANCIAL INFORMATIONITEM 1.FI

12、NANCIAL STATEMENTSNIKE,INC.UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOMETHREE MONTHS ENDED NOVEMBER 30,SIX MONTHS ENDED NOVEMBER 30,(In millions,except per share data)2023202220232022Revenues$13,388$13,315$26,327$26,002 Cost of sales7,417 7,604 14,636 14,676 Gross profit5,971 5,711 11,691 11

13、,326 Demand creation expense1,114 1,102 2,183 2,045 Operating overhead expense3,032 3,022 6,079 5,999 Total selling and administrative expense4,146 4,124 8,262 8,044 Interest expense(income),net(22)16(56)29 Other(income)expense,net(75)(79)(85)(225)Income before income taxes1,922 1,650 3,570 3,478 In

14、come tax expense344 319 542 679 NET INCOME$1,578$1,331$3,028$2,799 Earnings per common share:Basic$1.04$0.85$1.99$1.79 Diluted$1.03$0.85$1.97$1.77 Weighted average common shares outstanding:Basic1,520.8 1,559.0 1,524.6 1,563.1 Diluted1,532.1 1,572.4 1,537.7 1,579.1 The accompanying Notes to the Unau

15、dited Condensed Consolidated Financial Statements are an integral part of this statement.1Table of ContentsNIKE,INC.UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOMETHREE MONTHS ENDED NOVEMBER 30,SIX MONTHS ENDED NOVEMBER 30,(Dollars in millions)2023202220232022Net income$1,578$1,3

16、31$3,028$2,799 Other comprehensive income(loss),net of tax:Change in net foreign currency translation adjustment39 354 75 128 Change in net gains(losses)on cash flow hedges(55)(401)(189)154 Change in net gains(losses)on other1(30)4(41)Total other comprehensive income(loss),net of tax(15)(77)(110)241

17、 TOTAL COMPREHENSIVE INCOME$1,563$1,254$2,918$3,040 The accompanying Notes to the Unaudited Condensed Consolidated Financial Statements are an integral part of this statement.2Table of ContentsNIKE,INC.UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETSNOVEMBER 30,MAY 31,(In millions)20232023ASSETSCurre

18、nt assets:Cash and equivalents$7,919$7,441 Short-term investments2,008 3,234 Accounts receivable,net4,782 4,131 Inventories7,979 8,454 Prepaid expenses and other current assets1,943 1,942 Total current assets24,631 25,202 Property,plant and equipment,net5,153 5,081 Operating lease right-of-use asset

19、s,net2,943 2,923 Identifiable intangible assets,net269 274 Goodwill281 281 Deferred income taxes and other assets3,926 3,770 TOTAL ASSETS$37,203$37,531 LIABILITIES AND SHAREHOLDERS EQUITYCurrent liabilities:Current portion of long-term debt$Notes payable6 6 Accounts payable2,709 2,862 Current portio

20、n of operating lease liabilities456 425 Accrued liabilities5,470 5,723 Income taxes payable358 240 Total current liabilities8,999 9,256 Long-term debt8,930 8,927 Operating lease liabilities2,785 2,786 Deferred income taxes and other liabilities2,343 2,558 Commitments and contingencies(Note 11)Redeem

21、able preferred stock Shareholders equity:Common stock at stated value:Class A convertible 298 and 305 shares outstanding Class B 1,219 and 1,227 shares outstanding3 3 Capital in excess of stated value12,871 12,412 Accumulated other comprehensive income(loss)121 231 Retained earnings1,151 1,358 Total

22、 shareholders equity14,146 14,004 TOTAL LIABILITIES AND SHAREHOLDERS EQUITY$37,203$37,531 The accompanying Notes to the Unaudited Condensed Consolidated Financial Statements are an integral part of this statement.3Table of ContentsNIKE,INC.UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWSSIX

23、 MONTHS ENDED NOVEMBER 30,(Dollars in millions)20232022Cash provided(used)by operations:Net income$3,028$2,799 Adjustments to reconcile net income to net cash provided(used)by operations:Depreciation382 342 Deferred income taxes(144)(150)Stock-based compensation402 364 Amortization,impairment and ot

24、her(12)137 Net foreign currency adjustments(43)(125)Changes in certain working capital components and other assets and liabilities:(Increase)decrease in accounts receivable(649)(878)(Increase)decrease in inventories493(948)(Increase)decrease in prepaid expenses,operating lease right-of-use assets an

25、d other current and non-currentassets(394)(239)Increase(decrease)in accounts payable,accrued liabilities,operating lease liabilities and other current and non-current liabilities(312)56 Cash provided(used)by operations2,751 1,358 Cash provided(used)by investing activities:Purchases of short-term inv

26、estments(2,206)(3,500)Maturities of short-term investments1,477 1,951 Sales of short-term investments2,072 1,972 Additions to property,plant and equipment(458)(500)Other investing activities(10)54 Cash provided(used)by investing activities875(23)Cash provided(used)by financing activities:Increase(de

27、crease)in notes payable,net(3)Proceeds from exercise of stock options and other stock issuances327 260 Repurchase of common stock(2,331)(2,550)Dividends common and preferred(1,047)(960)Other financing activities(100)(68)Cash provided(used)by financing activities(3,151)(3,321)Effect of exchange rate

28、changes on cash and equivalents3(98)Net increase(decrease)in cash and equivalents478(2,084)Cash and equivalents,beginning of period7,441 8,574 CASH AND EQUIVALENTS,END OF PERIOD$7,919$6,490 Supplemental disclosure of cash flow information:Non-cash additions to property,plant and equipment$165$124 Di

29、vidends declared and not paid565 526 The accompanying Notes to the Unaudited Condensed Consolidated Financial Statements are an integral part of this statement.4Table of ContentsNIKE,INC.UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS EQUITYCOMMON STOCKCAPITAL INEXCESSOF STATEDVALUEACCUM

30、ULATEDOTHERCOMPREHENSIVEINCOME(LOSS)RETAINEDEARNINGSTOTALCLASS ACLASS B(In millions,except per share data)SHARESAMOUNTSHARESAMOUNTBalance at August 31,2023298$1,226$3$12,590$136$1,242$13,971 Stock options exercised2 106 106 Repurchase of Class B Common Stock(12)(99)(1,110)(1,209)Dividends on common

31、stock($0.370 per share)(565)(565)Issuance of shares to employees,net of shareswithheld for employee taxes3 68 6 74 Stock-based compensation206 206 Net income1,578 1,578 Other comprehensive income(loss)(15)(15)Balance at November 30,2023298$1,219$3$12,871$121$1,151$14,146 COMMON STOCKCAPITAL INEXCESS

32、OF STATEDVALUEACCUMULATEDOTHERCOMPREHENSIVEINCOME(LOSS)RETAINEDEARNINGSTOTALCLASS ACLASS B(In millions,except per share data)SHARESAMOUNTSHARESAMOUNTBalance at August 31,2022305$1,259$3$11,648$636$3,535$15,822 Stock options exercised1 69 69 Repurchase of Class B Common Stock(17)(123)(1,484)(1,607)Di

33、vidends on common stock($0.340 per share)(526)(526)Issuance of shares to employees,net of shareswithheld for employee taxes2 63 3 66 Stock-based compensation194 194 Net income1,331 1,331 Other comprehensive income(loss)(77)(77)Balance at November 30,2022305$1,245$3$11,851$559$2,859$15,272 COMMON STO

34、CKCAPITAL INEXCESSOF STATEDVALUEACCUMULATEDOTHERCOMPREHENSIVEINCOME(LOSS)RETAINEDEARNINGSTOTALCLASS ACLASS B(In millions,except per share data)SHARESAMOUNTSHARESAMOUNTBalance at May 31,2023305$1,227$3$12,412$231$1,358$14,004 Stock options exercised4 212 212 Conversion to Class B Common Stock(7)7 Rep

35、urchase of Class B Common Stock(22)(184)(2,157)(2,341)Dividends on common stock($0.710 per share)and preferred stock($0.10 per share)(1,084)(1,084)Issuance of shares to employees,net of shareswithheld for employee taxes3 29 6 35 Stock-based compensation402 402 Net income3,028 3,028 Other comprehensi

36、ve income(loss)(110)(110)Balance at November 30,2023298$1,219$3$12,871$121$1,151$14,146 5Table of ContentsCOMMON STOCKCAPITAL INEXCESSOF STATEDVALUEACCUMULATEDOTHERCOMPREHENSIVEINCOME(LOSS)RETAINEDEARNINGSTOTALCLASS ACLASS B(In millions,except per share data)SHARESAMOUNTSHARESAMOUNTBalance at May 31

37、,2022305$1,266$3$11,484$318$3,476$15,281 Stock options exercised3 149 149 Repurchase of Class B Common Stock(26)(189)(2,409)(2,598)Dividends on common stock($0.645 per share)and preferred stock($0.10 per share)(1,008)(1,008)Issuance of shares to employees,net of shareswithheld for employee taxes2 43

38、 1 44 Stock-based compensation364 364 Net income2,799 2,799 Other comprehensive income(loss)241 241 Balance at November 30,2022305$1,245$3$11,851$559$2,859$15,272 The accompanying Notes to the Unaudited Condensed Consolidated Financial Statements are an integral part of this statement.6Table of Cont

39、entsNOTES TO THE UNAUDITED CONDENSED CONSOLIDATEDFINANCIAL STATEMENTSNOTE 1Summary of Significant Accounting Policies8NOTE 2Accrued Liabilities9NOTE 3Fair Value Measurements9NOTE 4Income Taxes11NOTE 5Stock-Based Compensation11NOTE 6Earnings Per Share12NOTE 7Risk Management and Derivatives13NOTE 8Acc

40、umulated Other Comprehensive Income(Loss)16NOTE 9Revenues18NOTE 10Operating Segments20NOTE 11Contingencies22NOTE 12Acquisitions and Divestitures22NOTE 13Subsequent Events227Table of ContentsNOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIESBASIS OF PRESENTATIONThe Unaudited Condensed Consolidated Fin

41、ancial Statements include the accounts of NIKE,Inc.and its subsidiaries(the Company or NIKE)and reflect all normalrecurring adjustments which are,in the opinion of management,necessary for a fair statement of the results of operations for the interim period.The year-end CondensedConsolidated Balance

42、 Sheet data as of May 31,2023,was derived from audited financial statements,but does not include all disclosures required by accountingprinciples generally accepted in the United States of America(U.S.GAAP).The interim financial information and notes thereto should be read in conjunction with theCom

43、panys latest Annual Report on Form 10-K for the fiscal year ended May 31,2023(the Annual Report).The results of operations for the three and six months endedNovember 30,2023,are not necessarily indicative of results to be expected for the entire fiscal year.RECENTLY ISSUED ACCOUNTING STANDARDSIn Nov

44、ember 2023,the Financial Accounting Standards Board(the FASB)issued Accounting Standards Update(ASU)2023-07,Segment Reporting(Topic 280):Improvements to Reportable Segment Disclosures,which is intended to improve reportable segment disclosure requirements,primarily through enhanced disclosuresabout

45、significant expenses.The amendments will require public entities to disclose significant segment expenses that are regularly provided to the chief operatingdecision maker and included within segment profit and loss.The amendments are effective for the Companys annual periods beginning June 1,2024,an

46、d interim periodsbeginning June 1,2025,with early adoption permitted,and will be applied retrospectively to all prior periods presented in the financial statements.The Company iscurrently evaluating the ASU to determine its impact on the Companys disclosures.In December 2023,the FASB issued ASU 2023

47、-09,Income Taxes(Topic 740):Improvements to Income Tax Disclosures,which includes amendments that furtherenhance income tax disclosures,primarily through standardization and disaggregation of rate reconciliation categories and income taxes paid by jurisdiction.Theamendments are effective for the Com

48、panys annual periods beginning June 1,2025,with early adoption permitted,and should be applied either prospectively orretrospectively.The Company is currently evaluating the ASU to determine its impact on the Companys disclosures.RECENTLY ADOPTED ACCOUNTING STANDARDSIn September 2022,the FASB issued

49、 ASU 2022-04,Liabilities Supplier Finance Programs(Subtopic 405-50):Disclosure of Supplier Finance Program Obligations.Thenew guidance requires qualitative and quantitative disclosure sufficient to enable users of the financial statements to understand the nature,activity during the period,changes f

50、rom period to period and potential magnitude of such programs.The Company adopted the required guidance in the first quarter of fiscal 2024.Certain financial institutions offer voluntary supplier finance programs facilitated through a third-party platform that provide participating suppliers the opt

51、ion to financevalid payment obligations from the Company.The Company is not a party to agreements negotiated between participating suppliers and third-party financial institutions.The Companys obligations to its suppliers,including amounts due and payment terms,are not affected by a suppliers decisi

52、on to participate in these programs and theCompany does not provide guarantees to third parties in connection with these programs.As of November 30,2023 and May 31,2023,the Company had$819 millionand$834 million,respectively,of outstanding supplier obligations confirmed as valid under these programs

53、.These amounts are included within Accounts payable on theUnaudited Condensed Consolidated Balance Sheets.8Table of ContentsNOTE 2 ACCRUED LIABILITIESAccrued liabilities included the following:NOVEMBER 30,MAY 31,(Dollars in millions)20232023Compensation and benefits,excluding taxes$1,254$1,737 Sales

54、-related reserves1,130 994 Dividends payable568 529 Taxes other than income taxes payable499 377 Endorsement compensation415 552 Other1,604 1,534TOTAL ACCRUED LIABILITIES$5,470$5,723 NOTE 3 FAIR VALUE MEASUREMENTSThe Company measures certain financial assets and liabilities at fair value on a recurr

55、ing basis,including derivatives,equity securities and available-for-sale debtsecurities.For additional information about the Companys fair value policies,refer to Note 1 Summary of Significant Accounting Policies within the Annual Report.The following tables present information about the Companys fi

56、nancial assets measured at fair value on a recurring basis as of November 30,2023 and May 31,2023,and indicate the level in the fair value hierarchy in which the Company classifies the fair value measurement:NOVEMBER 30,2023(Dollars in millions)ASSETS AT FAIR VALUECASH AND EQUIVALENTSSHORT-TERM INVE

57、STMENTSCash$1,603$1,603$Level 1:U.S.Treasury securities1,420 1,420 Level 2:Commercial paper and bonds550 18 532 Money market funds5,653 5,653 Time deposits652 645 7 U.S.Agency securities49 49 Total Level 26,904 6,316 588 TOTAL$9,927$7,919$2,008 MAY 31,2023(Dollars in millions)ASSETS AT FAIR VALUECAS

58、H AND EQUIVALENTSSHORT-TERM INVESTMENTSCash$1,767$1,767$Level 1:U.S.Treasury securities2,655 2,655 Level 2:Commercial paper and bonds543 15 528 Money market funds5,157 5,157 Time deposits507 502 5 U.S.Agency securities46 46 Total Level 26,253 5,674 579 TOTAL$10,675$7,441$3,234 9Table of ContentsAs o

59、f November 30,2023,the Company held$1,316 million of available-for-sale debt securities with maturity dates within one year and$692 million with maturity datesgreater than one year and less than five years in Short-term investments on the Unaudited Condensed Consolidated Balance Sheets.The fair valu

60、e of the Companysavailable-for-sale debt securities approximates their amortized cost.Included in Interest expense(income),net was interest income related to the Companys investment portfolio of$92 million and$49 million for the three months endedNovember 30,2023 and 2022,respectively,and$191 millio

61、n and$114 million for the six months ended November 30,2023 and 2022,respectively.The following tables present information about the Companys derivative assets and liabilities measured at fair value on a recurring basis and indicate the level in the fairvalue hierarchy in which the Company classifie

62、s the fair value measurement:NOVEMBER 30,2023DERIVATIVE ASSETSDERIVATIVE LIABILITIES(Dollars in millions)ASSETS ATFAIR VALUEOTHERCURRENTASSETSOTHER LONG-TERM ASSETSLIABILITIESAT FAIRVALUEACCRUEDLIABILITIESOTHER LONG-TERMLIABILITIESLevel 2:Foreign exchange forwards and options$371$322$49$202$162$40(1

63、)If the foreign exchange derivative instruments had been netted on the Unaudited Condensed Consolidated Balance Sheets,the asset and liability positions each would have been reduced by$180million as of November 30,2023.As of that date,no amount of cash collateral had been received or posted on the d

64、erivative asset and liability balances related to these foreign exchange derivativeinstruments.MAY 31,2023DERIVATIVE ASSETSDERIVATIVE LIABILITIES(Dollars in millions)ASSETS ATFAIR VALUEOTHERCURRENTASSETSOTHER LONG-TERM ASSETSLIABILITIESAT FAIRVALUEACCRUEDLIABILITIESOTHER LONG-TERMLIABILITIESLevel 2:

65、Foreign exchange forwards and options$557$493$64$180$128$52(1)If the foreign exchange derivative instruments had been netted on the Consolidated Balance Sheets,the asset and liability positions each would have been reduced by$178 million as of May 31,2023.As of that date,the Company received$36 mill

66、ion of cash collateral from counterparties related to foreign exchange derivative instruments.No amount of collateral was posted on the derivative liabilitybalance as of May 31,2023.For additional information related to the Companys derivative financial instruments and credit risk,refer to Note 7 Ri

67、sk Management and Derivatives.The carrying amounts of other current financial assets and other current financial liabilities approximate fair value.FINANCIAL ASSETS AND LIABILITIES NOT RECORDED AT FAIR VALUEThe Companys Long-term debt is recorded at adjusted cost,net of unamortized premiums,discount

68、s and debt issuance costs.The fair value of long-term debt isestimated based upon quoted prices for similar instruments or quoted prices for identical instruments in inactive markets(Level 2).The fair value of the Companys Long-term debt,including the current portion,was approximately$7,744 million

69、at November 30,2023 and$7,889 million at May 31,2023.The carrying amounts reflected on the Unaudited Condensed Consolidated Balance Sheets for Notes payable approximate fair value.(1)(1)10Table of ContentsNOTE 4 INCOME TAXESThe effective tax rate was 15.2%and 19.5%for the six months ended November 3

70、0,2023 and 2022,respectively.The decrease in the Companys effective tax rate wasprimarily due to one-time benefits including the impact of temporary relief provided by the Internal Revenue Service(IRS)relating to U.S.foreign tax credit regulations.On July 21,2023,the IRS issued Notice 2023-55 which

71、specifically delayed the application of certain U.S.foreign tax credit regulations that had previously limited theCompanys ability to claim credits on certain foreign taxes for the fiscal year ended May 31,2023.As a result of this new guidance,the Company recognized a one-timetax benefit related to

72、prior year tax positions in the first three months of fiscal 2024.Other one-time benefits included a reduction in accrued withholding taxes onundistributed foreign earnings recognized in the second quarter of fiscal 2024.On August 16,2022,the U.S.government enacted the Inflation Reduction Act of 202

73、2 that included,among other provisions,changes to the U.S.corporate income taxsystem,including a fifteen percent minimum tax based on adjusted financial statement income,which was effective for the Company beginning June 1,2023.Based onthe Companys current analysis of the provisions,these tax law ch

74、anges are not expected to have a material impact on the Companys financial statements for fiscal2024.As of November 30,2023,total gross unrecognized tax benefits,excluding related interest and penalties,were$931 million,$649 million of which would affect theCompanys effective tax rate if recognized

75、in future periods.The majority of the total gross unrecognized tax benefits are long-term in nature and included within Deferredincome taxes and other liabilities on the Unaudited Condensed Consolidated Balance Sheets.As of May 31,2023,total gross unrecognized tax benefits,excluding relatedinterest

76、and penalties,were$936 million.As of November 30,2023 and May 31,2023,accrued interest and penalties related to uncertain tax positions were$287 millionand$268 million,respectively,(excluding federal benefit)and included within Deferred income taxes and other liabilities on the Unaudited Condensed C

77、onsolidatedBalance Sheets.The Company is subject to taxation in the U.S.,as well as various state and foreign jurisdictions.The Company is currently under audit by the U.S.IRS for fiscal years2017 through 2019.The Company has closed all U.S.federal income tax matters through fiscal 2016,with the exc

78、eption of certain transfer pricing adjustments.Tax years after 2011 remain open in certain major foreign jurisdictions.Although the timing of resolution of audits is not certain,the Company evaluates all domestic andforeign audit issues in the aggregate,along with the expiration of applicable statut

79、es of limitations,and estimates that it is reasonably possible the total grossunrecognized tax benefits could decrease by up to$30 million within the next 12 months.In January 2019,the European Commission opened a formal investigation toexamine whether the Netherlands has breached State Aid rules wh

80、en granting certain tax rulings to the Company.The Company believes the investigation is withoutmerit.If this matter is adversely resolved,the Netherlands may be required to assess additional amounts with respect to prior periods,and the Companys income taxesrelated to prior periods in the Netherlan

81、ds could increase.NOTE 5 STOCK-BASED COMPENSATIONSTOCK-BASED COMPENSATIONThe NIKE,Inc.Stock Incentive Plan(the Stock Incentive Plan)provides for the issuance of up to 798 million previously unissued shares of Class B Common Stock inconnection with equity awards granted under the Stock Incentive Plan

82、.The Stock Incentive Plan authorizes the grant of non-statutory stock options,incentive stockoptions,stock appreciation rights and stock awards,including restricted stock and restricted stock units.Restricted stock units include both time-vesting restricted stockunits(RSUs)as well as performance-bas

83、ed restricted stock units(PSUs).In addition to the Stock Incentive Plan,the Company gives employees the right to purchaseshares at a discount from the market price under employee stock purchase plans(ESPPs).For additional information,refer to Note 9 Common Stock and Stock-Based Compensation within t

84、he Annual Report.11Table of ContentsThe following table summarizes the Companys total stock-based compensation expense recognized in Cost of sales or Operating overhead expense,as applicable:THREE MONTHS ENDED NOVEMBER 30,SIX MONTHS ENDED NOVEMBER 30,(Dollars in millions)2023202220232022Stock option

85、s$88$79$164$154 ESPPs17 18 38 33 Restricted stock and restricted stock units101 97 200 177 TOTAL STOCK-BASED COMPENSATION EXPENSE$206$194$402$364(1)Expense for stock options includes the expense associated with stock appreciation rights.(2)Restricted stock units include RSUs and PSUs.The income tax

86、benefit related to stock-based compensation expense was$1 million and$2 million for the three months ended November 30,2023 and 2022,respectively,and$18 million and$22 million for the six months ended November 30,2023 and 2022,respectively,and reported within Income tax expense.STOCK OPTIONSAs of No

87、vember 30,2023,the Company had$621 million of unrecognized compensation costs from stock options,net of estimated forfeitures,to be recognized in Cost ofsales or Operating overhead expense,as applicable,over a weighted average remaining period of 2.7 years.RESTRICTED STOCK AND RESTRICTED STOCK UNITS

88、As of November 30,2023,the Company had$859 million of unrecognized compensation costs from restricted stock and restricted stock units,net of estimated forfeitures,to be recognized in Cost of sales or Operating overhead expense,as applicable,over a weighted average remaining period of 2.7 years.NOTE

89、 6 EARNINGS PER SHAREThe following is a reconciliation from basic earnings per common share to diluted earnings per common share.The computations of diluted earnings per common shareexclude restricted stock,restricted stock units and options,including shares under ESPPs,to purchase an estimated addi

90、tional 46.2 million and 38.0 million shares ofcommon stock outstanding for the three months ended November 30,2023 and 2022,respectively,and 43.5 million and 35.1 million shares of common stock outstandingfor the six months ended November 30,2023 and 2022,respectively,because the awards were assumed

91、 to be anti-dilutive.THREE MONTHS ENDEDNOVEMBER 30,SIX MONTHS ENDEDNOVEMBER 30,(In millions,except per share data)2023202220232022Net income available to common stockholders$1,578$1,331$3,028$2,799 Determination of shares:Weighted average common shares outstanding1,520.8 1,559.0 1,524.6 1,563.1 Assu

92、med conversion of dilutive stock options and awards11.3 13.4 13.1 16.0 DILUTED WEIGHTED AVERAGE COMMON SHARES OUTSTANDING1,532.1 1,572.4 1,537.7 1,579.1 Earnings per common share:Basic$1.04$0.85$1.99$1.79 Diluted$1.03$0.85$1.97$1.77(1)(2)12Table of ContentsNOTE 7 RISK MANAGEMENT AND DERIVATIVESThe C

93、ompany is exposed to global market risks,including the effect of changes in foreign currency exchange rates and interest rates,and uses derivatives to managefinancial exposures that occur in the normal course of business.As of and for the six months ended November 30,2023,there have been no material

94、 changes to theCompanys hedging program or strategy from what was disclosed within the Annual Report.For additional information about the Companys derivatives and hedgingpolicies,refer to Note 1 Summary of Significant Accounting Policies and Note 12 Risk Management and Derivatives within the Annual

95、Report.The majority of derivatives outstanding as of November 30,2023,are designated as foreign currency cash flow hedges,primarily for Euro/U.S.Dollar,British Pound/Euro,Chinese Yuan/U.S.Dollar and Japanese Yen/U.S.Dollar currency pairs.All derivatives are recognized on the Unaudited Condensed Cons

96、olidated Balance Sheets at fairvalue and classified based on the instruments maturity date.The following tables present the fair values of derivative instruments included within the Unaudited Condensed Consolidated Balance Sheets:DERIVATIVE ASSETSBALANCE SHEET LOCATIONNOVEMBER 30,MAY 31,(Dollars in

97、millions)20232023Derivatives formally designated as hedging instruments:Foreign exchange forwards and optionsPrepaid expenses and other current assets$309$480 Foreign exchange forwards and optionsDeferred income taxes and other assets49 64 Total derivatives formally designated as hedging instruments

98、358 544 Derivatives not designated as hedging instruments:Foreign exchange forwards and optionsPrepaid expenses and other current assets13 13 Total derivatives not designated as hedging instruments13 13 TOTAL DERIVATIVE ASSETS$371$557 DERIVATIVE LIABILITIESBALANCE SHEET LOCATIONNOVEMBER 30,MAY 31,(D

99、ollars in millions)20232023Derivatives formally designated as hedging instruments:Foreign exchange forwards and optionsAccrued liabilities$138$93 Foreign exchange forwards and optionsDeferred income taxes and other liabilities40 52 Total derivatives formally designated as hedging instruments178 145

100、Derivatives not designated as hedging instruments:Foreign exchange forwards and optionsAccrued liabilities24 35 Total derivatives not designated as hedging instruments24 35 TOTAL DERIVATIVE LIABILITIES$202$180 13Table of ContentsThe following tables present the amounts affecting the Unaudited Conden

101、sed Consolidated Statements of Income:(Dollars in millions)AMOUNT OF GAIN(LOSS)RECOGNIZED IN OTHERCOMPREHENSIVE INCOME(LOSS)ON DERIVATIVESAMOUNT OF GAIN(LOSS)RECLASSIFIED FROM ACCUMULATEDOTHER COMPREHENSIVEINCOME(LOSS)INTO INCOMETHREE MONTHS ENDEDNOVEMBER 30,LOCATION OF GAIN(LOSS)RECLASSIFIED FROM A

102、CCUMULATEDOTHER COMPREHENSIVE INCOME(LOSS)INTO INCOMETHREE MONTHS ENDEDNOVEMBER 30,2023202220232022Derivatives designated as cash flowhedges:Foreign exchange forwards and options$(5)$(3)Revenues$2$4 Foreign exchange forwards and options21(101)Cost of sales65 173 Foreign exchange forwards and options

103、2 2 Demand creation expense(2)Foreign exchange forwards and options39(47)Other(income)expense,net51 125 Interest rate swaps Interest expense(income),net(2)(2)TOTAL DESIGNATED CASH FLOWHEDGES$57$(149)$116$298(1)For the three months ended November 30,2023 and 2022,the amounts recorded in Other(income)

104、expense,net as a result of the discontinuance of cash flow hedges because the forecastedtransactions were no longer probable of occurring were immaterial.(2)Gains and losses associated with terminated interest rate swaps,which were previously designated as cash flow hedges and recorded in Accumulate

105、d other comprehensive income(loss),will bereleased through Interest expense(income),net over the term of the issued debt.(Dollars in millions)AMOUNT OF GAIN(LOSS)RECOGNIZED IN OTHERCOMPREHENSIVE INCOME(LOSS)ON DERIVATIVESAMOUNT OF GAIN(LOSS)RECLASSIFIED FROM ACCUMULATEDOTHER COMPREHENSIVEINCOME(LOSS

106、)INTO INCOMESIX MONTHS ENDED NOVEMBER30,LOCATION OF GAIN(LOSS)RECLASSIFIED FROM ACCUMULATEDOTHER COMPREHENSIVE INCOME(LOSS)INTO INCOMESIX MONTHS ENDED NOVEMBER30,2023202220232022Derivatives designated as cash flowhedges:Foreign exchange forwards and options$(23)$22 Revenues$3$(5)Foreign exchange for

107、wards and options19 386 Cost of sales151 282 Foreign exchange forwards and options2(3)Demand creation expense(3)Foreign exchange forwards and options29 246 Other(income)expense,net86 207 Interest rate swaps Interest expense(income),net(4)(4)TOTAL DESIGNATED CASH FLOWHEDGES$27$651$236$477(1)For the s

108、ix months ended November 30,2023 and 2022,the amounts recorded in Other(income)expense,net as a result of the discontinuance of cash flow hedges because the forecastedtransactions were no longer probable of occurring were immaterial.(2)Gains and losses associated with terminated interest rate swaps,

109、which were previously designated as cash flow hedges and recorded in Accumulated other comprehensive income(loss),will bereleased through Interest expense(income),net over the term of the issued debt.(1)(1)(2)(1)(1)(2)14Table of ContentsAMOUNT OF GAIN(LOSS)RECOGNIZEDIN INCOME ON DERIVATIVESLOCATION

110、OF GAIN(LOSS)RECOGNIZED IN INCOMEON DERIVATIVESTHREE MONTHS ENDEDNOVEMBER 30,SIX MONTHS ENDEDNOVEMBER 30,(Dollars in millions)2023202220232022Derivatives not designated as hedging instruments:Foreign exchange forwards and options and embeddedderivatives$17$17$(10)$78 Other(income)expense,netCASH FLO

111、W HEDGESThe total notional amount of outstanding foreign currency derivatives designated as cash flow hedges was approximately$17.7 billion as of November 30,2023.Approximately$252 million of deferred net gains(net of tax)on both outstanding and matured derivatives in Accumulated other comprehensive

112、 income(loss)as ofNovember 30,2023,are expected to be reclassified to Net income during the next 12 months concurrent with the underlying hedged transactions also being recorded inNet income.Actual amounts ultimately reclassified to Net income are dependent on the exchange rates in effect when deriv

113、ative contracts currently outstanding mature.As of November 30,2023,the maximum term over which the Company hedges exposures to the variability of cash flows for its forecasted transactions was 27 months.UNDESIGNATED DERIVATIVE INSTRUMENTSThe total notional amount of outstanding undesignated derivat

114、ive instruments was$4.6 billion as of November 30,2023.CREDIT RISKAs of November 30,2023,the Company was in compliance with all credit risk-related contingent features,and derivative instruments with such features were in a netasset position of approximately$169 million.Accordingly,the Company was n

115、ot required to post cash collateral as a result of these contingent features.Further,nocollateral was received on the Companys derivative asset balance as of November 30,2023.The Company considers the impact of the risk of counterparty default to beimmaterial.For additional information related to th

116、e Companys derivative financial instruments and collateral,refer to Note 3 Fair Value Measurements.15Table of ContentsNOTE 8 ACCUMULATED OTHER COMPREHENSIVE INCOME(LOSS)The changes in Accumulated other comprehensive income(loss),net of tax,were as follows:(Dollars in millions)FOREIGNCURRENCYTRANSLAT

117、IONADJUSTMENTCASH FLOWHEDGESNETINVESTMENTHEDGESOTHERTOTALBalance at August 31,2023$(217)$297$115$(59)$136 Other comprehensive income(loss):Other comprehensive gains(losses)before reclassifications37 48 11 96 Reclassifications to net income of previously deferred(gains)losses2(103)(10)(111)Total othe

118、r comprehensive income(loss)39(55)1(15)Balance at November 30,2023$(178)$242$115$(58)$121(1)The accumulated foreign currency translation adjustment and net investment hedge gains/losses related to an investment in a foreign subsidiary are reclassified to Net income upon sale or uponcomplete or subst

119、antially complete liquidation of the respective entity.(2)Net of immaterial tax impact.(Dollars in millions)FOREIGNCURRENCYTRANSLATIONADJUSTMENTCASH FLOWHEDGESNETINVESTMENTHEDGESOTHERTOTALBalance at August 31,2022$(746)$1,334$115$(67)$636 Other comprehensive income(loss):Other comprehensive gains(lo

120、sses)before reclassifications45(138)(24)(117)Reclassifications to net income of previously deferred(gains)losses309(263)(6)40 Total other comprehensive income(loss)354(401)(30)(77)Balance at November 30,2022$(392)$933$115$(97)$559(1)The accumulated foreign currency translation adjustment and net inv

121、estment hedge gains/losses related to an investment in a foreign subsidiary are reclassified to Net income upon sale or uponcomplete or substantially complete liquidation of the respective entity.(2)Net of immaterial tax impact.(Dollars in millions)FOREIGNCURRENCYTRANSLATIONADJUSTMENTCASH FLOWHEDGES

122、NETINVESTMENTHEDGESOTHERTOTALBalance at May 31,2023$(253)$431$115$(62)$231 Other comprehensive income(loss):Other comprehensive gains(losses)before reclassifications73 25 11 109 Reclassifications to net income of previously deferred(gains)losses2(214)(7)(219)Total other comprehensive income(loss)75(

123、189)4(110)Balance at November 30,2023$(178)$242$115$(58)$121(1)The accumulated foreign currency translation adjustment and net investment hedge gains/losses related to an investment in a foreign subsidiary are reclassified to Net income upon sale or uponcomplete or substantially complete liquidation

124、 of the respective entity.(2)Net of immaterial tax impact.(1)(1)(2)(2)(1)(1)(2)(2)(1)(1)(2)(2)16Table of Contents(Dollars in millions)FOREIGNCURRENCYTRANSLATIONADJUSTMENTCASH FLOWHEDGESNETINVESTMENTHEDGESOTHERTOTALBalance at May 31,2022$(520)$779$115$(56)$318 Other comprehensive income(loss):Other c

125、omprehensive gains(losses)before reclassifications(227)578 (27)324 Reclassifications to net income of previously deferred(gains)losses355(424)(14)(83)Total other comprehensive income(loss)128 154 (41)241 Balance at November 30,2022$(392)$933$115$(97)$559(1)The accumulated foreign currency translatio

126、n adjustment and net investment hedge gains/losses related to an investment in a foreign subsidiary are reclassified to Net income upon sale or uponcomplete or substantially complete liquidation of the respective entity.(2)Net of immaterial tax impact.The following table summarizes the reclassificat

127、ions from Accumulated other comprehensive income(loss)to the Unaudited Condensed Consolidated Statements ofIncome:AMOUNT OF GAIN(LOSS)RECLASSIFIED FROM ACCUMULATEDOTHER COMPREHENSIVE INCOME(LOSS)INTO INCOMELOCATION OF GAIN(LOSS)RECLASSIFIED FROMACCUMULATEDOTHER COMPREHENSIVEINCOME(LOSS)INTO INCOMETH

128、REE MONTHS ENDEDNOVEMBER 30,SIX MONTHS ENDED NOVEMBER30,(Dollars in millions)2023202220232022Gains(losses)on foreign currency translationadjustment$(2)$(325)$(2)$(371)Other(income)expense,netTotal before tax(2)(325)(2)(371)Tax(expense)benefit 16 16 Gain(loss)net of tax(2)(309)(2)(355)Gains(losses)on

129、 cash flow hedges:Foreign exchange forwards and options2 4 3(5)RevenuesForeign exchange forwards and options65 173 151 282 Cost of salesForeign exchange forwards and options(2)(3)Demand creation expenseForeign exchange forwards and options51 125 86 207 Other(income)expense,netInterest rate swaps(2)(

130、2)(4)(4)Interest expense(income),netTotal before tax116 298 236 477 Tax(expense)benefit(13)(35)(22)(53)Gain(loss)net of tax103 263 214 424 Gains(losses)on other14 9 10 20 Other(income)expense,netTotal before tax14 9 10 20 Tax(expense)benefit(4)(3)(3)(6)Gain(loss)net of tax10 6 7 14 Total net gain(lo

131、ss)reclassified for the period$111$(40)$219$83(1)(1)(2)(2)17Table of ContentsNOTE 9 REVENUESDISAGGREGATION OF REVENUESThe following tables present the Companys Revenues disaggregated by reportable operating segment,major product line and distribution channel:THREE MONTHS ENDED NOVEMBER 30,2023(Dolla

132、rs in millions)NORTHAMERICAEUROPE,MIDDLEEAST&AFRICAGREATERCHINAASIAPACIFIC&LATINAMERICAGLOBALBRANDDIVISIONSTOTALNIKEBRANDCONVERSECORPORATETOTALNIKE,INC.Revenues by:Footwear$3,757$2,186$1,361$1,303$8,607$442$9,049 Apparel1,668 1,200 469 437 3,774 30 3,804 Equipment200 181 33 65 479 7 486 Other 12 12

133、40(3)49 TOTAL REVENUES$5,625$3,567$1,863$1,805$12$12,872$519$(3)$13,388 Revenues by:Sales to Wholesale Customers$2,902$2,138$1,027$1,051$7,118$257$7,375 Sales through Direct to Consumer2,723 1,429 836 754 5,742 222 5,964 Other 12 12 40(3)49 TOTAL REVENUES$5,625$3,567$1,863$1,805$12$12,872$519$(3)$13

134、,388 THREE MONTHS ENDED NOVEMBER 30,2022(Dollars in millions)NORTHAMERICAEUROPE,MIDDLEEAST&AFRICAGREATERCHINAASIAPACIFIC&LATINAMERICAGLOBALBRANDDIVISIONSTOTALNIKEBRANDCONVERSECORPORATETOTALNIKE,INC.Revenues by:Footwear$3,963$2,063$1,370$1,108$8,504$517$9,021 Apparel1,685 1,281 393 435 3,794 21 3,815

135、 Equipment182 145 25 56 408 6 414 Other 18 18 42 5 65 TOTAL REVENUES$5,830$3,489$1,788$1,599$18$12,724$586$5$13,315 Revenues by:Sales to Wholesale Customers$3,183$2,242$897$965$7,287$304$7,591 Sales through Direct to Consumer2,647 1,247 891 634 5,419 240 5,659 Other 18 18 42 5 65 TOTAL REVENUES$5,83

136、0$3,489$1,788$1,599$18$12,724$586$5$13,315 18Table of ContentsSIX MONTHS ENDED NOVEMBER 30,2023(Dollars in millions)NORTHAMERICAEUROPE,MIDDLEEAST&AFRICAGREATERCHINAASIAPACIFIC&LATINAMERICAGLOBALBRANDDIVISIONSTOTALNIKEBRANDCONVERSECORPORATETOTALNIKE,INC.Revenues by:Footwear$7,490$4,446$2,648$2,444$17

137、,028$964$17,992 Apparel3,147 2,337 870 808 7,162 50 7,212 Equipment411 394 80 125 1,010 18 1,028 Other 25 25 75(5)95 TOTAL REVENUES$11,048$7,177$3,598$3,377$25$25,225$1,107$(5)$26,327 Revenues by:Sales to Wholesale Customers$5,674$4,517$1,922$1,988$14,101$586$14,687 Sales through Direct to Consumer5

138、,374 2,660 1,676 1,389 11,099 446 11,545 Other 25 25 75(5)95 TOTAL REVENUES$11,048$7,177$3,598$3,377$25$25,225$1,107$(5)$26,327 SIX MONTHS ENDED NOVEMBER 30,2022(Dollars in millions)NORTHAMERICAEUROPE,MIDDLEEAST&AFRICAGREATERCHINAASIAPACIFIC&LATINAMERICAGLOBALBRANDDIVISIONSTOTALNIKEBRANDCONVERSECORP

139、ORATETOTALNIKE,INC.Revenues by:Footwear$7,768$4,075$2,603$2,172$16,618$1,093$17,711 Apparel3,179 2,434 767 848 7,228 42 7,270 Equipment393 313 74 114 894 14 908 Other 32 32 80 1 113 TOTAL REVENUES$11,340$6,822$3,444$3,134$32$24,772$1,229$1$26,002 Revenues by:Sales to Wholesale Customers$6,210$4,445$

140、1,736$1,879$14,270$647$14,917 Sales through Direct to Consumer5,130 2,377 1,708 1,255 10,470 502 10,972 Other 32 32 80 1 113 TOTAL REVENUES$11,340$6,822$3,444$3,134$32$24,772$1,229$1$26,002 For the three and six months ended November 30,2023 and 2022,Global Brand Divisions revenues included NIKE Bra

141、nd licensing and other miscellaneous revenuesthat are not part of a geographic operating segment.Converse Other revenues were primarily attributable to licensing businesses.Corporate revenues primarily consistedof foreign currency hedge gains and losses related to revenues generated by entities with

142、in the NIKE Brand geographic operating segments and Converse,but managedthrough the Companys central foreign exchange risk management program.As of November 30,2023 and May 31,2023,the Company did not have any contract assets and had an immaterial amount of contract liabilities recorded in Accruedli

143、abilities on the Unaudited Condensed Consolidated Balance Sheets.19Table of ContentsNOTE 10 OPERATING SEGMENTSThe Companys operating segments are evidence of the structure of the Companys internal organization.The NIKE Brand segments are defined by geographic regionsfor operations participating in N

144、IKE Brand sales activity.Each NIKE Brand geographic segment operates predominantly in one industry:the design,development,marketing and selling of athletic footwear,apparel andequipment.The Companys reportable operating segments for the NIKE Brand are:North America;Europe,Middle East&Africa(EMEA);Gr

145、eater China;and AsiaPacific&Latin America(APLA),and include results for the NIKE and Jordan brands.The Companys NIKE Direct operations are managed within each NIKE Brand geographic operating segment.Converse is also a reportable segment for the Companyand operates in one industry:the design,marketin

146、g,licensing and selling of athletic lifestyle sneakers,apparel and accessories.Global Brand Divisions is included within the NIKE Brand for presentation purposes to align with the way management views the Company.Global Brand Divisionsrevenues include NIKE Brand licensing and other miscellaneous rev

147、enues that are not part of a geographic operating segment.Global Brand Divisions costs representdemand creation and operating overhead expense that include product creation and design expenses centrally managed for the NIKE Brand,as well as costs associatedwith NIKE Direct global digital operations

148、and enterprise technology.Corporate consists primarily of unallocated general and administrative expenses,including expenses associated with centrally managed departments;depreciation andamortization related to the Companys headquarters;unallocated insurance,benefit and compensation programs,includi

149、ng stock-based compensation;and certainforeign currency gains and losses,including certain hedge gains and losses.The primary financial measure used by the Company to evaluate performance of individual operating segments is earnings before interest and taxes(EBIT),whichrepresents Net income before I

150、nterest expense(income),net,and Income taxes in the Unaudited Condensed Consolidated Statements of Income.As part of the Companys centrally managed foreign exchange risk management program,standard foreign currency rates are assigned twice per year to each NIKEBrand entity in the Companys geographic

151、 operating segments and to Converse.These rates are set approximately nine and twelve months in advance of the futureselling seasons to which they relate(specifically,for each currency,one standard rate applies to the fall and holiday selling seasons,and one standard rate applies to thespring and su

152、mmer selling seasons)based on average market spot rates in the calendar month preceding the date they are established.Inventories and Cost of sales forgeographic operating segments and Converse reflect the use of these standard rates to record non-functional currency product purchases in the entitys

153、 functionalcurrency.Differences between assigned standard foreign currency rates and actual market rates are included in Corporate,together with foreign currency hedge gainsand losses generated from the Companys centrally managed foreign exchange risk management program and other conversion gains an

154、d losses.Accounts receivable,net,Inventories and Property,plant and equipment,net for operating segments are regularly reviewed by management and are therefore providedbelow.20Table of Contents THREE MONTHS ENDEDNOVEMBER 30,SIX MONTHS ENDED NOVEMBER30,(Dollars in millions)2023202220232022REVENUESNor

155、th America$5,625$5,830$11,048$11,340 Europe,Middle East&Africa3,567 3,489 7,177 6,822 Greater China1,863 1,788 3,598 3,444 Asia Pacific&Latin America1,805 1,599 3,377 3,134 Global Brand Divisions12 18 25 32 Total NIKE Brand12,872 12,724 25,225 24,772 Converse519 586 1,107 1,229 Corporate(3)5(5)1 TOT

156、AL NIKE,INC.REVENUES$13,388$13,315$26,327$26,002 EARNINGS BEFORE INTEREST AND TAXESNorth America$1,526$1,497$2,960$2,874 Europe,Middle East&Africa927 990 1,857 1,965 Greater China514 511 1,039 1,052 Asia Pacific&Latin America521 485 935 985 Global Brand Divisions(1,168)(1,226)(2,373)(2,413)Converse1

157、15 153 282 362 Corporate(535)(744)(1,186)(1,318)Interest expense(income),net(22)16(56)29 TOTAL NIKE,INC.INCOME BEFORE INCOME TAXES$1,922$1,650$3,570$3,478 NOVEMBER 30,MAY 31,(Dollars in millions)20232023ACCOUNTS RECEIVABLE,NETNorth America$1,902$1,653 Europe,Middle East&Africa1,369 1,197 Greater Chi

158、na194 162 Asia Pacific&Latin America919 700 Global Brand Divisions83 96 Total NIKE Brand4,467 3,808 Converse228 235 Corporate87 88 TOTAL ACCOUNTS RECEIVABLE,NET$4,782$4,131 INVENTORIESNorth America$3,327$3,806 Europe,Middle East&Africa2,013 2,167 Greater China1,218 973 Asia Pacific&Latin America946

159、894 Global Brand Divisions204 232 Total NIKE Brand7,708 8,072 Converse290 305 Corporate(19)77 TOTAL INVENTORIES$7,979$8,454(1)Inventories as of November 30,2023 and May 31,2023,were substantially all finished goods.(1)21Table of ContentsNOVEMBER 30,MAY 31,(Dollars in millions)20232023PROPERTY,PLANT

160、AND EQUIPMENT,NETNorth America$788$794 Europe,Middle East&Africa1,076 1,009 Greater China275 292 Asia Pacific&Latin America298 279 Global Brand Divisions908 840 Total NIKE Brand3,345 3,214 Converse33 38 Corporate1,775 1,829 TOTAL PROPERTY,PLANT AND EQUIPMENT,NET$5,153$5,081 NOTE 11 CONTINGENCIESIn t

161、he ordinary course of business,the Company is subject to various legal proceedings,claims and government investigations relating to its business,products andactions of its employees and representatives,including contractual and employment relationships,product liability,antitrust,customs,tax,intelle

162、ctual property and othermatters.The outcome of these legal matters is inherently uncertain,and the Company cannot predict the eventual outcome of currently pending matters,the timing oftheir ultimate resolution or the eventual losses,fines,penalties or consequences relating to those matters.When a l

163、oss related to a legal proceeding or claim is probableand reasonably estimable,the Company accrues its best estimate for the ultimate resolution of the matter.If one or more legal matters were to be resolved against theCompany in a reporting period for amounts above managements expectations,the Comp

164、anys financial position,operating results and cash flows for that reporting periodcould be materially adversely affected.In the opinion of management,based on its current knowledge and after consultation with counsel,the Company does not believeany currently pending legal matters will have a materia

165、l adverse impact on the Companys results of operations,financial position or cash flows,except as describedbelow.BELGIAN CUSTOMS CLAIMThe Company has received claims for certain years from Belgian Customs and other government authorities for alleged underpaid duties related to products importedbegin

166、ning in fiscal 2018.The Company disputes these claims and has engaged in the appellate process.The Company has issued bank guarantees in order to appealthe claims.At this time,the Company is unable to estimate the range of loss and cannot predict the final outcome as it could take several years to r

167、each a resolution onthis matter.If this matter is ultimately resolved against the Company,the amounts owed,including fines,penalties and other consequences relating to the matter,couldhave a material adverse effect on the Companys results of operations,financial position and cash flows.NOTE 12 ACQUI

168、SITIONS AND DIVESTITURESDuring the second quarter of fiscal 2023,the sale of the Companys entities in Argentina and Uruguay to a third-party distributor was completed and the net loss on thesale of these entities totaled approximately$550 million.This loss included$389 million,recognized primarily i

169、n fiscal 2020,largely due to the anticipated release of thecumulative foreign currency translation losses.The remaining loss recognized in fiscal 2023 was due to the devaluation of local currency and cash equivalents included inthe transferred assets.Upon completion of the sale,the foreign currency

170、translation losses recorded in Accumulated other comprehensive income(loss)were reclassifiedto Net income within Other(income)expense,net,on the Unaudited Condensed Consolidated Statements of Comprehensive Income along with the allowance forpreviously recognized losses recorded in Accrued liabilitie

171、s.The net loss was classified within Corporate.The net cash proceeds received are reflected within Other investing activities on the Unaudited Condensed Consolidated Statements of Cash Flows.NOTE 13 SUBSEQUENT EVENTSIn December 2023,the Company announced an enterprise initiative designed to accelera

172、te its future growth.As part of this initiative,management is taking steps tostreamline the organization which are expected to result in pre-tax restructuring charges of approximately$400 million to$450 million,primarily associated with employeeseverance costs largely expected to be recognized in th

173、e third quarter of fiscal 2024 within Operating overhead expense.The expected pre-tax charges are estimates andare subject to a number of assumptions.Actual results may vary from the estimates provided above.22Table of ContentsITEM 2.MANAGEMENTS DISCUSSION AND ANALYSIS OFFINANCIAL CONDITION AND RESU

174、LTS OF OPERATIONSOVERVIEWNIKE designs,develops,markets and sells athletic footwear,apparel,equipment,accessories and services worldwide.We are the largest seller of athletic footwear andapparel in the world.We sell our products through NIKE Direct operations,which is comprised of both NIKE-owned ret

175、ail stores and sales through our digital platforms(also referred to as NIKE Brand Digital),to wholesale accounts and to a mix of independent distributors,licensees and sales representatives in nearly all countriesaround the world.Our goal is to deliver value to our shareholders by building a profita

176、ble global portfolio of branded footwear,apparel,equipment and accessoriesbusinesses.Our strategy is to achieve long-term revenue growth by creating innovative,must-have products,building deep personal consumer connections with ourbrands and delivering compelling consumer experiences through digital

177、 platforms and at retail.Through the Consumer Direct Acceleration strategy,we are focused on creating the marketplace of the future with more premium,consistent and seamless consumerexperiences,leading with digital and our owned stores,as well as select wholesale partners.In addition,our product cre

178、ation and marketing organizations are aligned to aconsumer construct focused on sports dimensions through Mens,Womens and Kids,which allows us to better serve consumer needs.We continue to invest in a newEnterprise Resource Planning Platform,data and analytics,demand sensing,insight gathering and ot

179、her areas to create an end-to-end technology foundation,which webelieve will further accelerate our digital transformation.We believe this unified approach will accelerate growth and unlock more efficiency for our business,while drivingspeed and responsiveness as we serve consumers globally.QUARTERL

180、Y FINANCIAL HIGHLIGHTS NIKE,Inc.Revenues for the second quarter of fiscal 2024 were$13.4 billion,an increase of 1%on a reported basis and a decrease of 1%on a currency-neutralbasis,compared to the second quarter of fiscal 2023 NIKE Direct revenues grew 6%from$5.4 billion for the second quarter of fi

181、scal 2023 to$5.7 billion for the second quarter of fiscal 2024,and representedapproximately 45%of total NIKE Brand revenues for the second quarter of fiscal 2024 Gross margin for the second quarter of fiscal 2024 increased 170 basis points to 44.6%,primarily driven by strategic pricing actions and l

182、ower ocean freight rates,partially offset by unfavorable changes in net foreign currency exchange rates and higher product input costs Inventories as of November 30,2023,were$8.0 billion,a decrease of 6%compared to May 31,2023,primarily driven by a decrease in units We returned approximately$1.7 bil

183、lion to our shareholders in the second quarter of fiscal 2024 through share repurchases and dividendsECONOMIC CONDITIONS AND MARKET DYNAMICS Consumer Spending:During the second quarter of fiscal 2024,we saw shifts in consumer behavior as the global economy remains uncertain.Across our industry,consu

184、mers are spending more cautiously and promotional activity remains high.In this environment,we experienced lower digital traffic and moderation in ourrevenue growth.We will continue to monitor macroeconomic conditions,including the potential impacts of inflation and higher interest rates on consumer

185、 behavior.Cost Inflationary Pressures:Inflationary pressures,including higher product input costs,continued to negatively impact our gross margin.These negative impactson gross margin were more than offset by strategic pricing actions we have taken through the second quarter of fiscal 2024 as well a

186、s improvements in ocean freightrates we started to realize at the beginning of the second quarter of fiscal 2024.Supply Chain Conditions:During the first six months of fiscal 2024 and as of November 30,2023,our inventory levels were healthy and reflected our proactiveactions taken to manage our inve

187、ntory supply.In addition,we continued to experience normalized inventory transit times and flow of seasonal product.Foreign Currency Impacts:As a global company with significant operations outside the United States,we are exposed to risk arising from changes in foreigncurrency exchange rates.For add

188、itional information,refer to Foreign Currency Exposures and Hedging Practices.23Table of ContentsThe operating environment could remain volatile in fiscal 2024,and the risk exists that worsening macroeconomic conditions could have a material adverse impact on ourfuture revenue growth as well as over

189、all profitability.We continue to be confident in our brand strength and deep consumer connections.We are committed to acceleratingour pace of innovation,elevating our marketplace experiences and maximizing the impact of our storytelling.We will also continue to focus on driving gross marginexpansion

190、 and disciplined cost control.RECENT DEVELOPMENTSIn December 2023,we announced an enterprise initiative designed to accelerate our future growth.As part of this initiative,we are taking steps to streamline theorganization which are expected to result in pre-tax restructuring charges of approximately

191、$400 million to$450 million,primarily associated with employee severancecosts largely expected to be recognized in the third quarter of fiscal 2024 within Operating overhead expense.The expected pre-tax charges are estimates and subject toa number of assumptions.Actual results may differ from the es

192、timates provided above.USE OF NON-GAAP FINANCIAL MEASURESThroughout this Quarterly Report on Form 10-Q,we discuss non-GAAP financial measures,which should be considered in addition to,and not in lieu of,the financialmeasures calculated and presented in accordance with U.S.GAAP.References to these me

193、asures should not be considered in isolation or as a substitute for otherfinancial measures calculated and presented in accordance with U.S.GAAP and may not be comparable to similarly titled measures used by other companies.Management uses these non-GAAP measures when evaluating the Companys perform

194、ance,including when making financial and operating decisions.Additionally,management believes these non-GAAP financial measures provide investors with additional financial information that should be considered when assessing ourunderlying business performance and trends.Earnings Before Interest and

195、Taxes(EBIT):Calculated as Net income before Interest expense(income),net and Income tax expense in the Unaudited CondensedConsolidated Statements of Income.Total NIKE,Inc.EBIT for the three and six months ended November 30,2023 and 2022 are as follows:THREE MONTHS ENDED NOVEMBER 30,SIX MONTHS ENDED

196、NOVEMBER 30,(Dollars in millions)2023202220232022Net income$1,578$1,331$3,028$2,799 Add:Interest expense(income),net(22)16(56)29 Add:Income tax expense344 319 542 679 Earnings before interest and taxes$1,900$1,666$3,514$3,507 EBIT margin:Calculated as total NIKE,Inc.EBIT divided by total NIKE,Inc.Re

197、venues.Our EBIT margin calculation for the three and six months ended November 30,2023 and 2022 are as follows:THREE MONTHS ENDED NOVEMBER 30,SIX MONTHS ENDED NOVEMBER 30,(Dollars in millions)2023202220232022NumeratorEarnings before interest and taxes$1,900$1,666$3,514$3,507 DenominatorTotal NIKE,In

198、c.Revenues$13,388$13,315$26,327$26,002 EBIT margin14.2%12.5%13.3%13.5%Currency-neutral revenues:Currency-neutral revenues enhance visibility to underlying business trends,excluding the impact of translation arising from foreign currencyexchange rate fluctuations.Currency-neutral revenues are calcula

199、ted using actual exchange rates in use during the comparative prior year period in place of theexchange rates in use during the current period.Wholesale equivalent revenues:References to wholesale equivalent revenues are intended to provide context as to the total size of our NIKE Brand market footp

200、rint ifwe had no NIKE Direct operations.NIKE Brand wholesale equivalent revenues consist of(1)sales to external wholesale customers and(2)internal sales from ourwholesale operations to our NIKE Direct operations,which are charged at prices comparable to those charged to external wholesale customers.

201、24Table of ContentsCOMPARABLE STORE SALESComparable store sales:This key metric,which excludes NIKE Brand Digital sales,comprises revenues from NIKE-owned in-line and factory stores for which all three ofthe following requirements have been met:(1)the store has been open at least one year,(2)square

202、footage has not changed by more than 15%within the past year and(3)the store has not been permanently repositioned within the past year.Comparable store sales includes revenues from stores that were temporarily closed during theperiod as a result of COVID-19.Comparable store sales represents a perfo

203、rmance metric that we believe is useful information for management and investors inunderstanding the performance of our established NIKE-owned in-line and factory stores.Management considers this metric when making financial and operatingdecisions.The method of calculating comparable store sales var

204、ies across the retail industry.As a result,our calculation of this metric may not be comparable to similarlytitled metrics used by other companies.25Table of ContentsRESULTS OF OPERATIONSTHREE MONTHS ENDED NOVEMBER 30,SIX MONTHS ENDED NOVEMBER 30,(Dollars in millions,except per share data)20232022%C

205、HANGE20232022%CHANGERevenues$13,388$13,315 1%$26,327$26,002 1%Cost of sales7,417 7,604-2%14,636 14,676 0%Gross profit5,971 5,711 5%11,691 11,326 3%Gross margin44.6%42.9%44.4%43.6%Demand creation expense1,114 1,102 1%2,183 2,045 7%Operating overhead expense3,032 3,022 0%6,079 5,999 1%Total selling an

206、d administrative expense4,146 4,124 1%8,262 8,044 3%of revenues31.0%31.0%31.4%30.9%Interest expense(income),net(22)16 (56)29 Other(income)expense,net(75)(79)(85)(225)Income before income taxes1,922 1,650 16%3,570 3,478 3%Income tax expense344 319 8%542 679-20%Effective tax rate17.9%19.3%15.2%19.5%NE

207、T INCOME$1,578$1,331 19%$3,028$2,799 8%Diluted earnings per common share$1.03$0.85 21%$1.97$1.77 11%CONSOLIDATED OPERATING RESULTSREVENUESTHREE MONTHS ENDED NOVEMBER 30,SIX MONTHS ENDED NOVEMBER 30,(Dollars in millions)20232022%CHANGE%CHANGEEXCLUDINGCURRENCYCHANGES20232022%CHANGE%CHANGEEXCLUDINGCURR

208、ENCYCHANGESNIKE,Inc.Revenues:NIKE Brand Revenues by:Footwear$8,607$8,504 1%0%$17,028$16,618 2%2%Apparel3,774 3,794-1%-2%7,162 7,228-1%-1%Equipment479 408 17%15%1,010 894 13%12%Global Brand Divisions12 18-33%-41%25 32-22%-25%Total NIKE Brand Revenues12,872 12,724 1%0%25,225 24,772 2%2%Converse519 586

209、-11%-13%1,107 1,229-10%-11%Corporate(3)5 (5)1 TOTAL NIKE,INC.REVENUES$13,388$13,315 1%-1%$26,327$26,002 1%1%Supplemental NIKE Brand RevenuesDetails:NIKE Brand Revenues by:Sales to Wholesale Customers$7,118$7,287-2%-3%$14,101$14,270-1%-1%Sales through NIKE Direct5,742 5,419 6%4%11,099 10,470 6%5%Glob

210、al Brand Divisions12 18-33%-41%25 32-22%-25%TOTAL NIKE BRAND REVENUES$12,872$12,724 1%0%$25,225$24,772 2%2%(1)The percent change excluding currency changes represents a non-GAAP financial measure.For additional information,see Use of Non-GAAP Financial Measures.(2)Global Brand Divisions revenues inc

211、lude NIKE Brand licensing and other miscellaneous revenues that are not part of a geographic operating segment.(3)Corporate revenues primarily consist of foreign currency hedge gains and losses related to revenues generated by entities within the NIKE Brand geographic operating segments and Converse

212、,butmanaged through our central foreign exchange risk management program.(1)(1)(2)(3)(2)26Table of ContentsSECOND QUARTER OF FISCAL 2024 COMPARED TO SECOND QUARTER OF FISCAL 2023 NIKE,Inc.Revenues were$13.4 billion for the second quarter of fiscal 2024,which increased 1%on a reported basis and decre

213、ased 1%on a currency-neutral basis,compared to the second quarter of fiscal 2023.The decrease,on a currency-neutral basis,was driven by lower revenues in North America,Europe,Middle East&Africa(EMEA)and Converse,which each reduced NIKE,Inc.Revenues by approximately 1 percentage point.Higher revenues

214、 in Asia Pacific&Latin America(APLA)and Greater China each increased NIKE,Inc.Revenues by approximately 1 percentage point.NIKE Brand revenues,which represented over 90%of NIKE,Inc.Revenues,increased 1%on a reported basis and were flat on a currency-neutral basis.This wasdue to higher revenues in th

215、e Jordan Brand,offset by lower revenues in Mens,Kids and Womens.NIKE Brand footwear revenues were flat on a currency-neutral basis due to higher revenues in the Jordan Brand,offset by lower revenues in Mens,Kids andWomens.Unit sales of footwear decreased 6%,while higher average selling price(ASP)per

216、 pair contributed approximately 6 percentage points of footwearrevenue growth.Higher ASP per pair was primarily due to higher full-price ASP,net of discounts,on a wholesale equivalent basis,and growth in the size ofour NIKE Direct business.NIKE Brand apparel revenues decreased 2%on a currency-neutra

217、l basis,primarily due to lower revenues in Mens and Womens,partially offset by higherrevenues in the Jordan Brand.Unit sales of apparel decreased 15%,while higher ASP per unit contributed approximately 13 percentage points of apparelrevenue growth.Higher ASP per unit was primarily due to higher full

218、-price,NIKE Direct and off-price ASPs.NIKE Brand wholesale revenues decreased 2%and 3%compared to the second quarter of fiscal 2023,on a reported and currency-neutral basis,respectively,primarily due to decreases in North America and EMEA,reflecting our proactive decisions to prioritize marketplace

219、health in the current year coupled with ourliquidation of excess inventory in the prior year.NIKE Direct revenues increased 6%,on a reported basis,from$5.4 billion in the second quarter of fiscal 2023 to$5.7 billion in the second quarter of fiscal 2024.Ona currency-neutral basis,NIKE Direct revenues

220、 increased 4%,driven by comparable store sales growth of 5%,the addition of new stores and NIKE Brand Digitalsales growth of 1%.For additional information regarding comparable store sales,including the definition,see Comparable Store Sales.NIKE Brand Digital saleswere$3.5 billion for the second quar

221、ter of fiscal 2024 compared to$3.4 billion for the second quarter of fiscal 2023.Within NIKE Direct revenues,there were certainreclassifications made between NIKE-owned retail stores and NIKE Brand Digital in the prior period to conform to current period presentation.The reclassificationsdid not hav

222、e a material impact on our Unaudited Condensed Consolidated Financial Statements.FIRST SIX MONTHS OF FISCAL 2024 COMPARED TO FIRST SIX MONTHS OF FISCAL 2023 NIKE,Inc.Revenues were$26.3 billion for the first six months of fiscal 2024,which increased 1%compared to the first six months of fiscal 2023 o

223、n a reported andcurrency-neutral basis.The increase,on a currency-neutral basis,was driven by higher revenues in Greater China and APLA,which both contributed approximately 1percentage point to NIKE,Inc.Revenues.Lower revenues in North America reduced NIKE,Inc.Revenues by approximately 1 percentage

224、point.NIKE Brand revenues,which represented over 90%of NIKE,Inc.Revenues,increased 2%on a reported and currency-neutral basis.This increase was primarily dueto higher revenues in the Jordan Brand,partially offset by lower revenues in Mens and Kids.NIKE Brand footwear revenues increased 2%on a curren

225、cy-neutral basis due to higher revenues in the Jordan Brand and Womens,partially offset by lowerrevenues in Kids and Mens.Unit sales of footwear decreased 5%,while higher ASP per pair contributed approximately 7 percentage points of footwearrevenue growth.Higher ASP per pair was primarily due to hig

226、her full-price ASP and growth in NIKE Direct.NIKE Brand apparel revenues decreased 1%on a currency-neutral basis,primarily due to lower revenues in Mens,Womens and the Jordan Brand.Unitsales of apparel decreased 15%,while higher ASP per unit contributed approximately 14 percentage points of apparel

227、revenue growth.Higher ASP per unitwas primarily due to higher full-price and NIKE Direct ASPs.NIKE Direct revenues increased 6%,on a reported basis,from$10.5 billion for the first six months of fiscal 2023 to$11.1 billion for the first six months of fiscal 2024.On a currency-neutral basis,NIKE Direc

228、t revenues increased 5%,driven by comparable store sales growth of 7%,the addition of new stores and NIKE Brand Digitalsales growth of 2%.NIKE Brand Digital sales were$6.4 billion for the first six months of fiscal 2024 compared to$6.2 billion for the first six months of fiscal 2023.Within NIKE Dire

229、ct revenues,there were certain reclassifications made between NIKE-owned retail stores and NIKE Brand Digital in the prior period to conform tocurrent period presentation.The reclassifications did not have a material impact on our Unaudited Condensed Consolidated Financial Statements.27Table of Cont

230、entsGROSS MARGINTHREE MONTHS ENDED NOVEMBER 30,SIX MONTHS ENDED NOVEMBER 30,(Dollars in millions)20232022%CHANGE20232022%CHANGEGross profit$5,971$5,711 5%$11,691$11,326 3%Gross margin44.6%42.9%170 bps44.4%43.6%80 bpsSECOND QUARTER OF FISCAL 2024 COMPARED TO SECOND QUARTER OF FISCAL 2023For the secon

231、d quarter of fiscal 2024,our consolidated gross margin was 170 basis points higher than the prior year primarily due to:Higher NIKE Brand full-price ASP,net of discounts,on a wholesale equivalent basis(increasing gross margin approximately 320 basis points)primarily due tostrategic pricing actions a

232、nd lower discounts.This was partially offset by:Unfavorable changes in net foreign currency exchange rates,including hedges(decreasing gross margin approximately 60 basis points);Higher NIKE Brand product costs,on a wholesale equivalent basis(decreasing gross margin approximately 50 basis points),pr

233、imarily due to increased product inputcosts largely offset by lower ocean freight rates;Lower off-price margin,on a wholesale equivalent basis(decreasing gross margin approximately 20 basis points);and Lower margin in our NIKE Direct business(decreasing gross margin approximately 20 basis points).FI

234、RST SIX MONTHS OF FISCAL 2024 COMPARED TO FIRST SIX MONTHS OF FISCAL 2023For the first six months of fiscal 2024,our consolidated gross margin was 80 basis points higher than the prior year primarily due to:Higher NIKE Brand full-price ASP,net of discounts,on a wholesale equivalent basis(increasing

235、gross margin approximately 310 basis points)primarily due tostrategic pricing actions.This was partially offset by:Higher NIKE Brand product costs,on a wholesale equivalent basis(decreasing gross margin approximately 110 basis points),primarily due to increased productinput costs largely offset by l

236、ower ocean freight rates;Unfavorable changes in net foreign currency exchange rates,including hedges(decreasing gross margin approximately 80 basis points);and Lower off-price margin,on a wholesale equivalent basis(decreasing gross margin approximately 30 basis points).TOTAL SELLING AND ADMINISTRATI

237、VE EXPENSETHREE MONTHS ENDED NOVEMBER 30,SIX MONTHS ENDED NOVEMBER 30,(Dollars in millions)20232022%CHANGE20232022%CHANGEDemand creation expense$1,114$1,102 1%$2,183$2,045 7%Operating overhead expense3,032 3,022 0%6,079 5,999 1%Total selling and administrative expense$4,146$4,124 1%$8,262$8,044 3%of

238、 revenues31.0%31.0%bps31.4%30.9%50 bps(1)Demand creation expense consists of advertising and promotion costs,including costs of endorsement contracts,complimentary products,television,digital and print advertising and media costs,brandevents and retail brand presentation.SECOND QUARTER OF FISCAL 202

239、4 COMPARED TO SECOND QUARTER OF FISCAL 2023Demand creation expense increased 1%reflecting an increase in marketing expense.Changes in foreign currency exchange rates did not have a material impact onDemand creation expense.Operating overhead expense was flat as increases in NIKE Direct variable cost

240、s were offset by lower technology spend and wage-related expenses.Changes in foreigncurrency exchange rates did not have a material impact on Operating overhead expense.(1)28Table of ContentsFIRST SIX MONTHS OF FISCAL 2024 COMPARED TO FIRST SIX MONTHS OF FISCAL 2023Demand creation expense increased

241、7%reflecting an increase in marketing expense.Changes in foreign currency exchange rates did not have a material impact onDemand creation expense.Operating overhead expense increased 1%primarily due to higher wage-related expenses and NIKE Direct variable costs,partially offset by lower technology s

242、pend.Changes in foreign currency exchange rates did not have a material impact on Operating overhead expense.OTHER(INCOME)EXPENSE,NETTHREE MONTHS ENDED NOVEMBER 30,SIX MONTHS ENDED NOVEMBER 30,(Dollars in millions)2023202220232022Other(income)expense,net$(75)$(79)$(85)$(225)Other(income)expense,net

243、comprises foreign currency conversion gains and losses from the remeasurement of monetary assets and liabilities denominated in non-functional currencies and the impact of certain foreign currency derivative instruments,as well as unusual or non-operating transactions that are outside the normalcour

244、se of business.For the second quarter of fiscal 2024,Other(income)expense,net decreased from$79 million of other income,net,to$75 million of other income,net,in the currentyear,primarily due to a net unfavorable change in foreign currency conversion gains and losses,including hedges,partially offset

245、 by the loss recognized in the prior yearupon completion of the sale of our entities in Argentina and Uruguay to a third-party distributor.For the first six months of fiscal 2024,Other(income)expense,net decreased from$225 million of other income,net,to$85 million of other income,net,in the currenty

246、ear,primarily due to a net unfavorable change in foreign currency conversion gains and losses,including hedges,as well as net favorable settlements of legal matters inthe prior year,partially offset by the loss recognized in the prior year upon completion of the sale of our entities in Argentina and

247、 Uruguay to a third-party distributor.We estimate the combination of the translation of foreign currency-denominated profits from our international businesses and the year-over-year change in foreigncurrency-related gains and losses included in Other(income)expense,net had unfavorable impacts of app

248、roximately$37 million and$102 million on our Income beforeincome taxes for the second quarter and first six months of fiscal 2024.INCOME TAXESTHREE MONTHS ENDED NOVEMBER 30,SIX MONTHS ENDED NOVEMBER 30,20232022%CHANGE20232022%CHANGEEffective tax rate17.9%19.3%(140)bps15.2%19.5%(430)bpsOur effective

249、tax rate was 17.9%for the second quarter of fiscal 2024 compared to 19.3%for the second quarter of fiscal 2023,primarily due to a one-time benefitprovided by the reduction in accrued withholding taxes on undistributed foreign earnings.Our effective tax rate was 15.2%for the first six months of fisca

250、l 2024,compared to 19.5%for the first six months of fiscal 2023,primarily due to one-time benefitsprovided by the delay of the effective date of certain U.S.foreign tax credit regulations and a reduction in accrued withholding taxes on undistributed foreign earnings.For additional information,refer

251、to Note 4 Income Taxes within the accompanying Notes to the Unaudited Condensed Consolidated Financial Statements.29Table of ContentsOPERATING SEGMENTSAs discussed in Note 10 Operating Segments in the accompanying Notes to the Unaudited Condensed Consolidated Financial Statements,our operating segme

252、ntsare evidence of the structure of the Companys internal organization.The NIKE Brand segments are defined by geographic regions for operations participating in NIKEBrand sales activity.The breakdown of Revenues is as follows:THREE MONTHS ENDED NOVEMBER 30,SIX MONTHS ENDED NOVEMBER 30,(Dollars in mi

253、llions)20232022%CHANGE%CHANGEEXCLUDINGCURRENCYCHANGES20232022%CHANGE%CHANGEEXCLUDINGCURRENCYCHANGESNorth America$5,625$5,830-4%-3%$11,048$11,340-3%-2%Europe,Middle East&Africa3,567 3,489 2%-3%7,177 6,822 5%2%Greater China1,863 1,788 4%8%3,598 3,444 4%10%Asia Pacific&Latin America1,805 1,599 13%10%3,

254、377 3,134 8%7%Global Brand Divisions12 18-33%-41%25 32-22%-25%TOTAL NIKE BRAND12,872 12,724 1%0%25,225 24,772 2%2%Converse519 586-11%-13%1,107 1,229-10%-11%Corporate(3)5 (5)1 TOTAL NIKE,INC.REVENUES$13,388$13,315 1%-1%$26,327$26,002 1%1%(1)The percent change excluding currency changes represents a n

255、on-GAAP financial measure.For additional information,see Use of Non-GAAP Financial Measures.(2)Global Brand Divisions revenues include NIKE Brand licensing and other miscellaneous revenues that are not part of a geographic operating segment.(3)Corporate revenues primarily consist of foreign currency

256、 hedge gains and losses related to revenues generated by entities within the NIKE Brand geographic operating segments and Converse,butmanaged through our central foreign exchange risk management program.The primary financial measure used by the Company to evaluate performance of individual operating

257、 segments is EBIT.As discussed in Note 10 Operating Segmentsin the accompanying Notes to the Unaudited Condensed Consolidated Financial Statements,certain corporate costs are not included in EBIT of our operating segments.The breakdown of EBIT is as follows:THREE MONTHS ENDED NOVEMBER 30,SIX MONTHS

258、ENDED NOVEMBER 30,(Dollars in millions)20232022%CHANGE20232022%CHANGENorth America$1,526$1,497 2%$2,960$2,874 3%Europe,Middle East&Africa927 990-6%1,857 1,965-5%Greater China514 511 1%1,039 1,052-1%Asia Pacific&Latin America521 485 7%935 985-5%Global Brand Divisions(1,168)(1,226)5%(2,373)(2,413)2%TO

259、TAL NIKE BRAND2,320 2,257 3%4,418 4,463-1%Converse115 153-25%282 362-22%Corporate(535)(744)28%(1,186)(1,318)10%TOTAL NIKE,INC.EARNINGS BEFORE INTERESTAND TAXES1,900 1,666 14%3,514 3,507 0%EBIT margin14.2%12.5%13.3%13.5%Interest expense(income),net(22)16 (56)29 TOTAL NIKE,INC.INCOME BEFORE INCOMETAXE

260、S$1,922$1,650 16%$3,570$3,478 3%(1)Total NIKE Brand EBIT,Total NIKE,Inc.EBIT and EBIT margin represent non-GAAP financial measures.For additional information,see Use of Non-GAAP Financial Measures.(1)(1)(2)(3)(1)(1)(1)30Table of ContentsNORTH AMERICATHREE MONTHS ENDED NOVEMBER 30,SIX MONTHS ENDED NO

261、VEMBER 30,(Dollars in millions)20232022%CHANGE%CHANGEEXCLUDINGCURRENCYCHANGES20232022%CHANGE%CHANGEEXCLUDINGCURRENCYCHANGESRevenues by:Footwear$3,757$3,963-5%-5%$7,490$7,768-4%-3%Apparel1,668 1,685-1%-1%3,147 3,179-1%-1%Equipment200 182 10%10%411 393 5%5%TOTAL REVENUES$5,625$5,830-4%-3%$11,048$11,34

262、0-3%-2%Revenues by:Sales to Wholesale Customers$2,902$3,183-9%-9%$5,674$6,210-9%-9%Sales through NIKE Direct2,723 2,647 3%3%5,374 5,130 5%5%TOTAL REVENUES$5,625$5,830-4%-3%$11,048$11,340-3%-2%EARNINGS BEFORE INTEREST ANDTAXES$1,526$1,497 2%$2,960$2,874 3%SECOND QUARTER OF FISCAL 2024 COMPARED TO SEC

263、OND QUARTER OF FISCAL 2023 North America revenues decreased 3%on a currency-neutral basis due to lower revenues in Mens,Kids and Womens,partially offset by higher revenues in theJordan Brand.Wholesale revenues decreased 9%,reflecting our proactive decisions to prioritize marketplace health in the cu

264、rrent year coupled with our liquidation ofexcess inventory in the prior year.NIKE Direct revenues increased 3%,driven by digital sales growth of 2%,comparable store sales growth of 1%and the addition ofnew stores.Footwear revenues decreased 5%on a currency-neutral basis due to lower revenues in Mens

265、,Kids and Womens,partially offset by higher revenues in the JordanBrand.Unit sales of footwear decreased 17%,while higher ASP per pair contributed approximately 12 percentage points of footwear revenue growth.Higher ASP perpair was primarily due to higher full-price and NIKE Direct ASPs as well as g

266、rowth in NIKE Direct.Apparel revenues decreased 1%on a currency-neutral basis,primarily due to lower revenues in Mens,partially offset by higher revenues in Kids and Womens.Unitsales of apparel decreased 16%,while higher ASP per unit contributed 15 percentage points of apparel revenue growth.Higher

267、ASP per unit was primarily due tohigher full-price and NIKE Direct ASPs.Reported EBIT increased 2%reflecting lower revenues and the following:Gross margin expansion of 240 basis points primarily due to higher full-price ASP,net of discounts,largely due to strategic pricing actions and lower discount

268、s.Thiswas partially offset by higher product costs,reflecting higher product input costs partially offset by lower ocean freight rates,and lower margin in NIKE Direct.Selling and administrative expense increase of 2%driven by higher operating overhead expense.The increase in operating overhead expen

269、se was primarily due toan increase in NIKE Direct variable costs,partially offset by lower wage-related expenses.Demand creation expense was flat as lower sports marketing expense wasoffset by higher digital marketing.31Table of ContentsFIRST SIX MONTHS OF FISCAL 2024 COMPARED TO FIRST SIX MONTHS OF

270、 FISCAL 2023 North America revenues decreased 2%on a currency-neutral basis due to lower revenues in Mens,Womens and Kids,partially offset by higher revenues in theJordan Brand.Wholesale revenues decreased 9%,reflecting our proactive decisions to prioritize marketplace health in the current year cou

271、pled with our liquidation ofexcess inventory in the prior year.NIKE Direct revenues increased 5%,driven by comparable sales growth of 4%,the addition of new stores and digital sales growthof 3%.Footwear revenues decreased 3%on a currency-neutral basis due to lower revenues in Mens,Kids and Womens,pa

272、rtially offset by higher revenues in the JordanBrand.Unit sales of footwear decreased 15%,while higher ASP per pair contributed approximately 12 percentage points of footwear revenue growth.Higher ASP perpair was primarily due to higher full-price and NIKE Direct ASPs as well as growth in NIKE Direc

273、t.Apparel revenues decreased 1%on a currency-neutral basis due to lower revenues in Mens,Womens and the Jordan Brand,partially offset by higher revenues inKids.Unit sales of apparel decreased 17%,while higher ASP per unit contributed 16 percentage points of apparel revenue growth.Higher ASP per unit

274、 was primarilydue to higher full-price and NIKE Direct ASPs.Reported EBIT increased 3%reflecting lower revenues and the following:Gross margin expansion of 240 basis points primarily due to higher full-price ASP,net of discounts,largely due to strategic pricing actions and lower discounts.Thiswas pa

275、rtially offset by higher product costs,reflecting higher product input costs partially offset by lower ocean freight rates.Selling and administrative expense increase of 3%driven by higher operating overhead expense.The increase in operating overhead expense was primarily due tohigher NIKE Direct va

276、riable costs.Demand creation expense was flat as lower sports marketing expense and lower advertising and marketing expense was offset byhigher digital marketing.EUROPE,MIDDLE EAST&AFRICATHREE MONTHS ENDED NOVEMBER 30,SIX MONTHS ENDED NOVEMBER 30,(Dollars in millions)20232022%CHANGE%CHANGEEXCLUDINGC

277、URRENCYCHANGES20232022%CHANGE%CHANGEEXCLUDINGCURRENCYCHANGESRevenues by:Footwear$2,186$2,063 6%1%$4,446$4,075 9%6%Apparel1,200 1,281-6%-10%2,337 2,434-4%-7%Equipment181 145 25%18%394 313 26%21%TOTAL REVENUES$3,567$3,489 2%-3%$7,177$6,822 5%2%Revenues by:Sales to Wholesale Customers$2,138$2,242-5%-8%

278、$4,517$4,445 2%-1%Sales through NIKE Direct1,429 1,247 15%7%2,660 2,377 12%7%TOTAL REVENUES$3,567$3,489 2%-3%$7,177$6,822 5%2%EARNINGS BEFORE INTEREST ANDTAXES$927$990-6%$1,857$1,965-5%SECOND QUARTER OF FISCAL 2024 COMPARED TO SECOND QUARTER OF FISCAL 2023 EMEA revenues decreased 3%on a currency-neu

279、tral basis due to lower revenues in Womens,Kids and Mens,partially offset by higher revenues in the JordanBrand.Wholesale revenues decreased 8%,reflecting our proactive decisions to prioritize marketplace health in the current year coupled with our liquidation of excessinventory in the prior year.NI

280、KE Direct revenues increased 7%,driven by digital sales growth of 7%,comparable store sales growth of 8%and the addition of newstores.Footwear revenues increased 1%on a currency-neutral basis due to higher revenues in Mens and the Jordan Brand,largely offset by lower revenues in Kids andWomens.Unit

281、sales of footwear decreased 5%,while higher ASP per pair contributed approximately 6 percentage points of footwear revenue growth.Higher ASPper pair was primarily due to growth in NIKE Direct and higher full-price ASP.Apparel revenues decreased 10%on a currency-neutral basis primarily due to lower r

282、evenues in Mens,Womens and Kids.Unit sales of apparel decreased 21%,while higher ASP per unit contributed approximately 11 percentage points of apparel revenue growth.Higher ASP per unit was primarily due to higher full-price andNIKE Direct ASPs.32Table of ContentsReported EBIT decreased 6%reflectin

283、g higher revenues and the following:Gross margin contraction of 140 basis points largely due to unfavorable changes in standard foreign currency exchange rates,partially offset by lower product costs,reflecting lower ocean freight rates,higher full-price ASP,net of discounts,primarily due to strateg

284、ic pricing actions,and higher margin in NIKE Direct.Selling and administrative expense increase of 8%due to higher demand creation and operating overhead expense.Demand creation expense increased primarilydue to higher sports marketing expense and unfavorable changes in foreign currency exchange rat

285、es.Operating overhead expense increased primarily due tounfavorable changes in foreign currency exchange rates.FIRST SIX MONTHS OF FISCAL 2024 COMPARED TO FIRST SIX MONTHS OF FISCAL 2023 EMEA revenues increased 2%on a currency-neutral basis due to higher revenues in Mens,partially offset by lower re

286、venues in Kids,Womens and the JordanBrand.NIKE Direct revenues increased 7%,driven by comparable store sales growth of 11%,the addition of new stores and digital sales growth of 3%.Footwear revenues increased 6%on a currency-neutral basis,primarily due to higher revenues in Mens and Womens,partially

287、 offset by lower revenues in Kids.Unit sales of footwear decreased 1%,while higher ASP per pair contributed approximately 7 percentage points of footwear revenue growth.Higher ASP per pair wasprimarily due to higher full-price ASP and growth in NIKE Direct.Apparel revenues decreased 7%on a currency-

288、neutral basis due to lower revenues in Mens,Womens,the Jordan Brand and Kids.Unit sales of apparel decreased18%,while higher ASP per unit contributed approximately 11 percentage points of apparel revenue growth.Higher ASP per unit was primarily due to higher full-priceand NIKE Direct ASPs.Reported E

289、BIT decreased 5%reflecting higher revenues and the following:Gross margin contraction of 220 basis points largely due to unfavorable changes in standard foreign currency exchange rates,partially offset by higher full-price ASP,net of discounts,primarily due to strategic pricing actions and higher ma

290、rgin in NIKE Direct.Selling and administrative expense increase of 9%due to higher operating overhead and demand creation expense.Operating overhead expense increasedprimarily due to higher wage-related expenses,other administrative costs and unfavorable changes in foreign currency exchange rates.De

291、mand creation expenseincreased primarily due to higher sports marketing expense and unfavorable changes in foreign currency exchange rates.GREATER CHINATHREE MONTHS ENDED NOVEMBER 30,SIX MONTHS ENDED NOVEMBER 30,(Dollars in millions)20232022%CHANGE%CHANGEEXCLUDINGCURRENCYCHANGES20232022%CHANGE%CHANG

292、EEXCLUDINGCURRENCYCHANGESRevenues by:Footwear$1,361$1,370-1%3%$2,648$2,603 2%7%Apparel469 393 19%24%870 767 13%19%Equipment33 25 32%36%80 74 8%12%TOTAL REVENUES$1,863$1,788 4%8%$3,598$3,444 4%10%Revenues by:Sales to Wholesale Customers$1,027$897 14%19%$1,922$1,736 11%17%Sales through NIKE Direct836

293、891-6%-4%1,676 1,708-2%3%TOTAL REVENUES$1,863$1,788 4%8%$3,598$3,444 4%10%EARNINGS BEFORE INTEREST ANDTAXES$514$511 1%$1,039$1,052-1%33Table of ContentsSECOND QUARTER OF FISCAL 2024 COMPARED TO SECOND QUARTER OF FISCAL 2023 Greater China revenues increased 8%on a currency-neutral basis due to higher

294、 revenues in Mens,the Jordan Brand,Womens and Kids.NIKE Direct revenuesdecreased 4%due to digital sales declines of 22%,reflecting reduced digital traffic,partially offset by comparable store sales growth of 7%and growth in non-comparable store sales.Footwear revenues increased 3%on a currency-neutr

295、al basis due to higher revenues in Mens,the Jordan Brand,Kids and Womens.Unit sales of footwearincreased 3%and ASP per pair was flat,as lower NIKE Direct ASP and a lower mix of NIKE Direct sales were offset by higher full-price and off-price ASPs.Apparel revenues increased 24%on a currency-neutral b

296、asis due to higher revenues in Mens,the Jordan Brand,Womens and Kids.Unit sales of apparel increased16%,while higher ASP per unit contributed approximately 8 percentage points of apparel revenue growth.Higher ASP per unit was primarily due to higher NIKEDirect and off-price ASPs.Reported EBIT increa

297、sed 1%reflecting higher revenues and the following:Gross margin expansion of approximately 80 basis points,primarily due to lower product costs,reflecting product mix,partially offset by unfavorable changes instandard foreign currency exchange rates and lower ASP,net of discounts,reflecting product

298、mix partially offset by lower discounts.Selling and administrative expense increase of 7%primarily due to higher operating overhead expense.Operating overhead expense increased due to higher NIKEDirect costs,partially offset by favorable changes in foreign currency exchange rates.FIRST SIX MONTHS OF

299、 FISCAL 2024 COMPARED TO FIRST SIX MONTHS OF FISCAL 2023 Greater China revenues increased 10%on a currency-neutral basis due to higher revenues in Mens,the Jordan Brand,Womens and Kids.NIKE Direct revenuesincreased 3%due to comparable store sales growth of 7%and growth in non-comparable store sales,

300、partially offset by digital sales declines of 10%,reflectingreduced digital traffic.Footwear revenues increased 7%on a currency-neutral basis due to higher revenues in the Jordan Brand,Mens,Womens and Kids.Unit sales of footwearincreased 6%,while higher ASP per pair contributed approximately 1 perce

301、ntage point of footwear revenue growth.Higher ASP per pair was primarily due to higherfull-price ASP,partially offset by lower NIKE Direct ASP.Apparel revenues increased 19%on a currency-neutral basis,primarily due to higher revenues in Mens,Womens,and Kids.Unit sales of apparel increased 5%,while h

302、igher ASP per unit contributed approximately 14 percentage points of apparel revenue growth.Higher ASP per unit was primarily due to higher NIKE Directand full-price ASPs,as well as a higher mix of full-price sales.Reported EBIT decreased 1%reflecting higher revenues and the following:Flat gross mar

303、gin,primarily due to unfavorable changes in standard foreign currency exchange rates offset by higher full-price ASP,net of discounts,largely due tolower discounts.Selling and administrative expense increase of 7%primarily due to higher operating overhead and demand creation expense.Operating overhe

304、ad expenseincreased primarily due to higher NIKE Direct costs,partially offset by favorable changes in foreign currency exchange rates.Demand creation expense increasedprimarily due to higher advertising and marketing expense,partially offset by favorable changes in foreign currency exchange rates.3

305、4Table of ContentsASIA PACIFIC&LATIN AMERICATHREE MONTHS ENDED NOVEMBER 30,SIX MONTHS ENDED NOVEMBER 30,(Dollars in millions)20232022%CHANGE%CHANGEEXCLUDINGCURRENCYCHANGES20232022%CHANGE%CHANGEEXCLUDINGCURRENCYCHANGESRevenues by:Footwear$1,303$1,108 18%15%$2,444$2,172 13%11%Apparel437 435 0%-2%808 8

306、48-5%-5%Equipment65 56 16%15%125 114 10%9%TOTAL REVENUES$1,805$1,599 13%10%$3,377$3,134 8%7%Revenues by:Sales to Wholesale Customers$1,051$965 9%7%$1,988$1,879 6%5%Sales through NIKE Direct754 634 19%15%1,389 1,255 11%9%TOTAL REVENUES$1,805$1,599 13%10%$3,377$3,134 8%7%EARNINGS BEFORE INTEREST ANDTA

307、XES$521$485 7%$935$985-5%We completed the sale of our entity in Chile and our entities in Argentina and Uruguay to third-party distributors in the first and second quarters of fiscal 2023,respectively.The impacts from closing these transactions are included within Corporate and are not reflected in

308、the Asia Pacific&Latin America operating segment results.Thiscompleted the transition of our NIKE Brand businesses within our Central and South America(CASA)marketplace,which now reflects a full distributor operating model.SECOND QUARTER OF FISCAL 2024 COMPARED TO SECOND QUARTER OF FISCAL 2023 APLA

309、revenues increased 10%on a currency-neutral basis due to higher revenues across most territories,led by Southeast Asia&India,Korea and Mexico.Revenues increased due to overall growth in Mens,the Jordan Brand,Womens and Kids.NIKE Direct revenues increased 15%,driven by digital sales growth of14%,comp

310、arable store sales growth of 11%and the addition of new stores.Footwear revenues increased 15%on a currency-neutral basis,due to higher revenues in Mens,Womens,the Jordan Brand and Kids.Unit sales of footwearincreased 10%,while higher ASP per unit contributed approximately 5 percentage points of foo

311、twear revenue growth.Higher ASP per pair was primarily due to higherfull-price ASP,growth in NIKE Direct and higher off-price ASP,partially offset by lower NIKE Direct ASP.Apparel revenues decreased 2%on a currency-neutral basis,primarily due to lower revenues in Mens and Womens.Unit sales of appare

312、l decreased 9%,whilehigher ASP per unit contributed approximately 7 percentage points of apparel revenue growth.Higher ASP per unit was primarily due to higher full-price ASP,growthin NIKE Direct and higher off-price ASP,partially offset by lower NIKE Direct ASP.Reported EBIT increased 7%reflecting

313、higher revenues and the following:Gross margin contraction of approximately 200 basis points primarily due to unfavorable changes in standard foreign currency exchange rates and lower margin inNIKE Direct.This was partially offset by higher full-price ASP,net of discounts,primarily due to strategic

314、pricing actions.Selling and administrative expense increase of 9%due to higher demand creation and operating overhead expense.Demand creation expense increased primarilydue to higher digital marketing and sports marketing expense.Operating overhead expense increased primarily due to higher wage-rela

315、ted expenses and NIKEDirect variable costs.FIRST SIX MONTHS OF FISCAL 2024 COMPARED TO FIRST SIX MONTHS OF FISCAL 2023 APLA revenues increased 7%on a currency-neutral basis due to higher revenues across most territories,led by Southeast Asia&India,Japan,Mexico and Korea,partially offset by lower rev

316、enues in CASA.Within our CASA territory,the transition of our Chile,Argentina and Uruguay entities to a third-party distributor operatingmodel did not have a material impact on APLA revenues.Revenues increased due to overall growth in Mens,the Jordan Brand,Womens and Kids.NIKE Directrevenues increas

317、ed 9%,driven by comparable store sales growth of 11%,the addition of new stores and digital sales growth of 6%.Footwear revenues increased 11%on a currency-neutral basis due to higher revenues in Mens,Womens,the Jordan Brand and Kids.Unit sales of footwearincreased 8%,while higher ASP per unit contr

318、ibuted approximately 3 percentage points of footwear revenue growth.Higher ASP per pair was primarily due to higherfull-price ASP,growth in NIKE Direct and higher off-price ASP,partially offset by lower NIKE Direct ASP.35Table of Contents Apparel revenues decreased 5%on a currency-neutral basis,prim

319、arily due to lower revenues in Mens and Womens.Unit sales of apparel decreased 13%,whilehigher ASP per unit contributed approximately 8 percentage points of apparel revenue growth.Higher ASP per unit was primarily due to higher full-price ASP,growthin NIKE Direct and higher off-price ASP,partially o

320、ffset by lower NIKE Direct ASP.Reported EBIT decreased 5%reflecting higher revenues and the following:Gross margin contraction of approximately 310 basis points primarily due to unfavorable changes in standard foreign currency exchange rates,lower margin in NIKEDirect and higher product costs,reflec

321、ting higher product input costs.This was partially offset by higher full-price ASP,net of discounts.Selling and administrative expense increase of 12%due to higher demand creation and operating overhead expense.Demand creation expense increased primarilydue to higher marketing expense.Operating over

322、head expense increased primarily due to higher wage-related expenses and NIKE Direct variable costs.GLOBAL BRAND DIVISIONSTHREE MONTHS ENDED NOVEMBER 30,SIX MONTHS ENDED NOVEMBER 30,(Dollars in millions)20232022%CHANGE%CHANGEEXCLUDINGCURRENCYCHANGES20232022%CHANGE%CHANGEEXCLUDINGCURRENCYCHANGESReven

323、ues$12$18-33%-41%$25$32-22%-25%Earnings(Loss)Before Interest and Taxes$(1,168)$(1,226)5%$(2,373)$(2,413)2%Global Brand Divisions primarily represent demand creation and operating overhead expense,including product creation and design expenses that are centrally managedfor the NIKE Brand,as well as c

324、osts associated with NIKE Direct global digital operations and enterprise technology.Global Brand Divisions revenues include NIKE Brandlicensing and other miscellaneous revenues that are not part of a geographic operating segment.SECOND QUARTER OF FISCAL 2024 COMPARED TO SECOND QUARTER OF FISCAL 202

325、3Global Brand Divisions loss before interest and taxes decreased 5%primarily due to lower operating overhead and demand creation expense.Lower operating overheadexpense was primarily due to lower technology spend and wage-related costs.Lower demand creation expense was primarily due to decreased adv

326、ertising and marketingexpense.FIRST SIX MONTHS OF FISCAL 2024 COMPARED TO FIRST SIX MONTHS OF FISCAL 2023Global Brand Divisions loss before interest and taxes decreased 2%primarily due to lower operating overhead expense partially offset by higher demand creationexpense.Lower operating overhead expe

327、nse was primarily due to lower technology spend and lower wage-related costs.Higher demand creation expense was primarilydue to higher advertising and marketing expense.36CONVERSETHREE MONTHS ENDED NOVEMBER 30,SIX MONTHS ENDED NOVEMBER 30,(Dollars in millions)20232022%CHANGE%CHANGEEXCLUDINGCURRENCYC

328、HANGES20232022%CHANGE%CHANGEEXCLUDINGCURRENCYCHANGESRevenues by:Footwear$442$517-15%-16%$964$1,093-12%-13%Apparel30 21 43%45%50 42 19%22%Equipment7 6 17%20%18 14 29%28%Other40 42-5%-5%75 80-6%-6%TOTAL REVENUES$519$586-11%-13%$1,107$1,229-10%-11%Revenues by:Sales to Wholesale Customers$257$304-15%-17

329、%$586$647-9%-11%Sales through Direct to Consumer222 240-8%-9%446 502-11%-11%Other40 42-5%-5%75 80-6%-6%TOTAL REVENUES$519$586-11%-13%$1,107$1,229-10%-11%EARNINGS BEFORE INTERESTAND TAXES$115$153-25%$282$362-22%(1)Other revenues consist of territories serviced by third-party licensees who pay royalti

330、es to Converse for the use of its registered trademarks and other intellectual property rights.We do not own theConverse trademarks in Japan and accordingly do not earn revenues in Japan.SECOND QUARTER OF FISCAL 2024 COMPARED TO SECOND QUARTER OF FISCAL 2023 Converse revenues decreased 13%on a curre

331、ncy-neutral basis as revenue declines in North America and Western Europe were partially offset by growth in Asia.Combined unit sales within the wholesale and direct to consumer channels decreased 13%,driven primarily by a decrease in wholesale,while ASP was flat.Wholesale revenues decreased 17%on a

332、 currency-neutral basis,as declines in North America and Western Europe were partially offset by growth in Asia.Direct to consumer revenues decreased 9%on a currency-neutral basis primarily due to reduced traffic in North America.Reported EBIT decreased 25%reflecting lower revenues and the following

333、:Gross margin contraction of approximately 160 basis points due to lower margin in direct to consumer and unfavorable changes in standard foreign currencyexchange rates,offset by lower ocean freight rates.Selling and administrative expense decrease of 8%due to lower demand creation and operating overhead expense.Demand creation expense decreased as a resultof lower advertising and marketing costs