Nike : Q321 Financial Schedules & Key Financial Metrics

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

(In millions, except per share data)

THREE MONTHS ENDED 2/28/2021 2/29/2020

% ChangeNINE MONTHS ENDED 2/28/2021 2/29/2020

% Change

Revenues

$

31,090 4%

Cost of sales Gross profit

• 10,357 $ 5,638 4,719 45.6 %

10,104 5,631 4,473 44.3 %

3% $ 0%

• 32,194 $ 17,887

17,202 4%

Gross margin

• 5% 14,307 44.4 %

13,888 3% 44.7 %

Demand creation expense Operating overhead expense

711 2,330 3,041 29.4 %

870 2,413 3,283 32.5 %

-18% -3% -7%

2,117 7,166 9,283 28.8 %

2,769 -24%

7,166 0%

Total selling and administrative expense % of revenues

9,935 -7% 32.0 %

Interest expense (income), net Other (income) expense, net Income before income taxes Income tax expense

(22) 1,636 187 11.4 %

64

12 297 881 34 3.9 %

- -

199 18

39 223

- -

• 86% 4,807

3,691 30%

450%

Effective tax rate

589 12.3 %

362 63% 9.8 %

NET INCOME

$

1,449

$

847

71% $

4,218

$

3,329 27%

Earnings per common share:

Basic

$ $

0.92 0.90

$ $

0.54 0.53

70% $ 70% $

2.68 2.62

$ $

2.13 26%

Diluted

2.09 25%

Weighted average common shares outstanding:

Basic

1,578.0 1,616.9

1,556.3 1,591.6

• 1,570.9 1,559.8

  Diluted

• 1,607.3 1,594.6

Dividends declared per common share

• $ 0.275

• $ 0.245

$

0.795

• $ 0.710

CONSOLIDATED BALANCE SHEETS

(Unaudited)

(Dollars in millions)	% Change
ASSETS
Current assets:
Cash and equivalents	$	8,516 $	2,863	197%
Short-term investments	4,012	319	1,158%
Accounts receivable, net	3,669	4,473	-18%
Inventories	6,693	5,807	15%
Prepaid expenses and other current assets	1,810	2,282	-21%
Total current assets	24,700	15,744	57%
Property, plant and equipment, net	4,958	4,783	4%
Operating lease right-of-use assets, net	3,149	2,907	8%
Identifiable intangible assets, net	271	275	-1%
Goodwill	242	223	9%
Deferred income taxes and other assets	2,865	2,288	25%
TOTAL ASSETS	$	36,185 $	26,220	38%
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt	$	- $	4	-100%
Notes payable	4	9	-56%
Accounts payable	2,257	2,221	2%
Current portion of operating lease liabilities	470	422	11%
Accrued liabilities	5,907	5,356	10%
Income taxes payable	256	268	-4%
Total current liabilities	8,894	8,280	7%
Long-term debt	9,412	3,463	172%
Operating lease liabilities	2,964	2,758	7%
Deferred income taxes and other liabilities	2,984	2,674	12%
Redeemable preferred stock	-	-	-
Shareholders' equity	11,931	9,045	32%
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$	36,185 $	26,220	38%

February 28, 2021

February 29, 2020

DIVISIONAL REVENUES

(Unaudited)

% ChangeTHREE MONTHS ENDED %ECxucrlruednicnyg

(Dollars in millions)

2/28/2021 2/29/2020 Change Changes1

NINE MONTHS ENDED 2/28/2021 2/29/2020

% Change

% Change Excluding Currency Changes1

North America

Footwear Apparel Equipment

$

Total

Europe, Middle East & Africa

Footwear

Apparel Equipment

Total

Greater China

Footwear Apparel Equipment

Total

2,382 $ 1,087 95 3,564 1,606 898 105 2,609 1,614 616 49 2,279

2,628 1,228 123 3,979 1,711 889 109 2,709 1,075 400 31 1,506

-9% -11% -23% -10% -6% 1% -4% -4% 50% 54% 58% 51%

-9% $

7,851 $

• -12% 3,580

Asia Pacific & Latin America

Footwear

903

963

-6%

Apparel Equipment

365

388

-6%

47

63

-25%

-22% -11% -11% -4% -6% -9% 41% 44% 53% 42% -7% -8% -26%

364 11,795 5,139 2,973 365 8,477 4,432 1,775 150 6,357 2,652 1,098 135

7,723 4,076 455 12,254 5,005 2,655 359 8,019 3,486 1,428 118 5,032 2,890 1,154 183

Total

1,315

1,414

-7%

• -8% 3,885

4,227

2% 2% -12% -12% -20% -20% -4% -4% 3% -1% 12% 8% 2% 0% 6% 2% 27% 23% 24% 20% 27% 24% 26% 22% -8% -5% -5% -2% -26% -23% -8% -5%

24 -25% -27%

Global Brand Divisions2 TOTAL NIKE BRAND Converse

Corporate3

6 9,773 570 14

8 9,616 506 (18)

-25% 2% 13% -

-32% -2% 8% -

18 30,532 1,609 53

29,556 1,541

3% 2% 4% 2%

(7)

-

-

TOTAL NIKE, INC. REVENUES

$

10,357 $

10,104

3%

-1% $

32,194 $

31,090

4% 2%

TOTAL NIKE BRAND

Footwear

$

Apparel Equipment

Global Brand Divisions2

24

6,505 $ 2,966 296 6

6,377 2,905 326 8

2% 2% -9% -25%

-1% $ -1% -11% -32%

20,074 $ 9,426 1,014 18

19,104 9,313 1,115

5% 4% 1% 0% -9% -9% -25% -27%

TOTAL NIKE BRAND REVENUES

$

9,773 $

9,616

2%

-2% $

30,532 $

29,556

3% 2%

1 The percent change has been calculated using actual exchange rates in use during the comparative prior year period and is provided to enhance the visibility of the underlying business trends by excluding the impact of translation arising from foreign currency exchange rate fluctuations, which is considered a non-GAAP financial measure. Management uses this non-GAAP financial measure when evaluating the Company's performance, including when making financial and operating decisions. Additionally, management believes this non-GAAP financial measure provides investors with additional financial information that should be considered when assessing the Company's underlying business performance and trends. References to this measure should not be considered in isolation or as a substitute for other financial measures calculated and presented in accordance with U.S. GAAP and may not be comparable to similarly titled non-GAAP measures used by other companies.

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 hedge gains and losses related to revenues generated by entities within the NIKE Brand geographic operating segments and Converse, but managed through the Company's central foreign exchange risk management program.

EARNINGS BEFORE INTEREST AND TAXES1

(Unaudited)

(Dollars in millions)
North America	$	970 $	937
Europe, Middle East & Africa	533	575
Greater China	973	556
Asia Pacific & Latin America	408	387
Global Brand Divisions2	(852)	(895)
TOTAL NIKE BRAND1	2,032	1,560
Converse	150	96
Corporate3	(482)	(763)
TOTAL NIKE, INC. EARNINGS BEFORE
INTEREST AND TAXES1	1,700	893
Interest expense (income), net	64	12
TOTAL NIKE, INC. INCOME BEFORE
INCOME TAXES	$	1,636 $	881

THREE MONTHS ENDED	%	%
2/28/2021 2/29/2020	Change	Change
4% $	3,295 $	2,912	13%
-7%	1,885	1,694	11%
75%	2,552	1,919	33%
5%	1,112	1,105	1%
5%	(2,546)	(2,624)	3%
30%	6,298	5,006	26%
56%	405	324	25%
37%	(1,697)	(1,600)	-6%
90%	5,006	3,730	34%
-	199	39	-
86% $	4,807 $	3,691	30%

NINE MONTHS ENDED 2/28/2021 2/29/2020

1 The Company evaluates the performance of individual operating segments based on earnings before interest and taxes (commonly referred to as "EBIT"), which represents net income before interest expense (income), net and income tax expense. Total NIKE Brand EBIT and Total NIKE, Inc. EBIT are considered non-GAAP financial measures and are being provided as management believes this additional information should be considered when assessing the Company's underlying business performance and trends. References to EBIT should not be considered in isolation or as a substitute for other financial measures calculated and presented in accordance with U.S. GAAP and may not be comparable to similarly titled non-GAAP measures used by other companies.

2 Global Brand Divisions primarily represent demand creation and operating overhead expense, including product creation and design expenses that are centrally managed for the NIKE Brand, as well as costs associated with NIKE Direct global digital operations and enterprise technology. Global Brand Divisions revenues include NIKE Brand licensing and other miscellaneous revenues that are not part of a geographic operating segment.

3 Corporate consists primarily of unallocated general and administrative expenses, including expenses associated with centrally managed departments; depreciation and amortization related to the Company's corporate headquarters; unallocated insurance, benefit and compensation programs, including stock-based compensation; and certain foreign currency gains and losses, including certain hedge gains and losses. For the three and nine months ended February 28, 2021, Corporate included non-recurring employee termination and related costs associated with the previously announced leadership and operating model changes.

NIKE, Inc.

RETURN ON INVESTED CAPITAL1

(Unaudited)

FOR THE TRAILING FOUR

QUARTERS ENDED

(Dollars in millions)

2/28/2021

5/31/2020

Numerator

Net income

$

3,428 $ 2,539

249 89

Add: Interest expense (income), net Add: Income tax expense

575 348

4,252 2,976

Earnings before interest and taxes Income tax adjustment2

(601)

(352)

Earnings before interest and after taxes

$

3,651

$

2,624

AVERAGE FOR THE TRAILING

FIVE QUARTERS ENDED

2/28/2021

5/31/2020

Denominator

Total debt3,4

$

11,658 $ 8,022

Add: Shareholders' equity

9,779 8,938

Less: Cash and equivalents and Short-term investments Total invested capital

9,158 4,756

$

12,279

$

12,204

RETURN ON INVESTED CAPITAL

29.7 %

21.5 %

1 Return on invested capital ("ROIC") represents a performance measure that management believes is useful information in understanding the Company's ability to effectively manage invested capital. ROIC is considered a non-GAAP financial measure and should not be considered in isolation or as a substitute for other financial measures calculated and presented in accordance with U.S. GAAP and may not be comparable to similarly titled non-GAAP measures used by other companies.

• 2 Equals Earnings before interest and taxes multiplied by the effective tax rate as of the respective quarter end.

• 3 Total debt includes the following: 1) Current portion of long-term debt, 2) Notes Payable, 3) Current portion of operating lease liabilities, 4) Long-term debt and 5) Operating lease liabilities.

4 The Company adopted Accounting Standards Codification No. 842, Leases, on June 1, 2019. For comparability, total debt for each quarter prior to adoption includes approximately $3.2 billion, which represents the current and long-term portion of the Company's operating lease liabilities as of June 1, 2019.