Is Nike profitable?
Profitability is crucial to a company's success. Earnings tend to be the biggest factor driving a stock's long-term performance. Investors should take the time to research a company's profitability to ensure it's heading in the right direction.
Nike is a very profitable company. It reported $12.4 billion of revenue in its fiscal 2024 third quarter, up slightly from the previous year. Meanwhile, revenue over the first nine months of its fiscal year was $38.4 billion, a 1% increase from the previous year. The company's net income was almost $1.2 billion in its fiscal third quarter and $4.2 billion over the nine-month period. While its net income declined 5% year over year in the third quarter, it increased by 4% over the nine-month period compared to the previous year. Nike's earnings per share have grown even faster over the nine-month period (7%) due to a steady decline in its outstanding shares as it repurchases stock.
The company also produces a lot of cash, allowing it to return money to shareholders via dividends and share repurchases. Nike paid $562 million of dividends in its fiscal third quarter (up 6% year over year) and repurchased $866 million in shares. The repurchases were part of the company's four-year, $18 billion program, which its board of directors approved in June 2022. Nike had repurchased $8 billion of its stock under the program through early 2024.
Nike's solid and growing profitability has enabled it to maintain a strong balance sheet. It had $10.6 billion of cash, equivalents, and short-term investments at the end of its fiscal third quarter, exceeding its long-term debt ($8.9 billion).
