What Are Nike’s Key Markets?

Nike’s top-line growth in 1H17 was fueled by strong performances in its international markets.

Sonya Bells - Author

Mar. 16 2017, Updated 2:05 p.m. ET


Which regions boosted Nike’s top line the most?

As discussed in the previous section, Nike’s top-line growth in 1H17 was fueled by strong performances in its international markets. Japan and Greater China were the best-performing territories and recorded revenue increases of 26% and 14% YoY (year-over-year), respectively.

Growth in sales in Nike’s foreign markets far outpaced North America sales growth. North American revenue rose 4.6% during 1H17 as compared to 1H16. Similarly, Under Armour (UAA) saw North American sales rise 6% YoY (versus a two-year average of 23%), while its international business shot up 60% during its last reported quarter.

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North America returns to a pull market in 2Q17

While the pace of growth remained slow, North America returned to being a pull market after the supply-demand balance was restored during the second quarter. The company expects to bear the fruit of this alignment in 2H17 as well. The management expects revenue growth to exceed futures order growth and is also looking for some gross margin expansion in the remaining half of 2017.

What categories drove growth?

North American favorites were Sportswear and the Jordan brand, while Western Europe favored the Global Football, Running, Sportswear, and Jordan brands. Greater China revenue growth was fueled by double-digit growth in both footwear and apparel. We’ll discuss the performance of various product categories and channels in the next section.

ETF investors seeking to add exposure to Nike can consider the SPDR Consumer Discretionary Select Sector ETF (XLY), which invests 3.1% of its portfolio in Nike.


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