Item 1. FINANCIAL STATEMENTS

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Item 1. FINANCIAL STATEMENTS

NIKE, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME


	THREE MONTHS ENDED				NINE MONTHS ENDED
(In millions, except per share data)	FEBRUARY 29, 2024		FEBRUARY 28, 2023		FEBRUARY 29, 2024		FEBRUARY 28, 2023
Revenues	$	12,429	$	12,390	$	38,756	$	38,392
Cost of sales	6,867		7,019		21,503		21,695
Gross profit	5,562		5,371		17,253		16,697
Demand creation expense	1,011		923		3,194		2,968
Operating overhead expense	3,215		3,036		9,294		9,035
Total selling and administrative expense	4,226		3,959		12,488		12,003
Interest expense (income), net	(52)		(7)		(108)		22
Other (income) expense, net	(16)		(58)		(101)		(283)
Income before income taxes	1,404		1,477		4,974		4,955
Income tax expense	232		237		774		916
NET INCOME	$	1,172	$	1,240	$	4,200	$	4,039
Earnings per common share:
Basic	$	0.77	$	0.80	$	2.76	$	2.59
Diluted	$	0.77	$	0.79	$	2.74	$	2.57
Weighted average common shares outstanding:
Basic	1,513.2		1,543.8		1,520.8		1,556.7
Diluted	1,526.5		1,564.8		1,534.0		1,574.4

The accompanying Notes to the Unaudited Condensed Consolidated Financial Statements are an integral part of this statement.

NIKE, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME


	THREE MONTHS ENDED				NINE MONTHS ENDED
(Dollars in millions)	FEBRUARY 29, 2024		FEBRUARY 28, 2023		FEBRUARY 29, 2024		FEBRUARY 28, 2023
Net income	$	1,172	$	1,240	$	4,200	$	4,039
Other comprehensive income (loss), net of tax:
Change in net foreign currency translation adjustment	(57)		153		18		281
Change in net gains (losses) on cash flow hedges	50		(433)		(139)		(279)
Change in net gains (losses) on other	11		23		15		(18)
Total other comprehensive income (loss), net of tax	4		(257)		(106)		(16)
TOTAL COMPREHENSIVE INCOME	$	1,176	$	983	$	4,094	$	4,023

The accompanying Notes to the Unaudited Condensed Consolidated Financial Statements are an integral part of this statement.

NIKE, INC.

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS


	FEBRUARY 29,		MAY 31,
(In millions)	2024		2023
ASSETS
Current assets:
Cash and equivalents	$	8,960	$	7,441
Short-term investments	1,613		3,234
Accounts receivable, net	4,526		4,131
Inventories	7,726		8,454
Prepaid expenses and other current assets	1,928		1,942
Total current assets	24,753		25,202
Property, plant and equipment, net	5,082		5,081
Operating lease right-of-use assets, net	2,856		2,923
Identifiable intangible assets, net	259		274
Goodwill	240		281
Deferred income taxes and other assets	4,166		3,770
TOTAL ASSETS	$	37,356	$	37,531
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt	$	—	$	—
Notes payable	6		6
Accounts payable	2,340		2,862
Current portion of operating lease liabilities	474		425
Accrued liabilities	5,818		5,723
Income taxes payable	391		240
Total current liabilities	9,029		9,256
Long-term debt	8,930		8,927
Operating lease liabilities	2,691		2,786
Deferred income taxes and other liabilities	2,480		2,558
Commitments and contingencies (Note 12)
Redeemable preferred stock	—		—
Shareholders' equity:
Common stock at stated value:
Class A convertible — 298 and 305 shares outstanding	—		—
Class B — 1,213 and 1,227 shares outstanding	3		3
Capital in excess of stated value	13,128		12,412
Accumulated other comprehensive income (loss)	125		231
Retained earnings	970		1,358
Total shareholders' equity	14,226		14,004
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$	37,356	$	37,531

The accompanying Notes to the Unaudited Condensed Consolidated Financial Statements are an integral part of this statement.

NIKE, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS


	NINE MONTHS ENDED
(Dollars in millions)	FEBRUARY 29, 2024		FEBRUARY 28, 2023
Cash provided (used) by operations:
Net income	$	4,200	$	4,039
Adjustments to reconcile net income to net cash provided (used) by operations:
Depreciation	589		516
Deferred income taxes	(281)		(216)
Stock-based compensation	618		556
Amortization, impairment and other	51		107
Net foreign currency adjustments	(81)		(197)
Changes in certain working capital components and other assets and liabilities:
(Increase) decrease in accounts receivable	(429)		109
(Increase) decrease in inventories	698		(527)
(Increase) decrease in prepaid expenses, operating lease right-of-use assets and other current and non-current assets	(342)		(273)
Increase (decrease) in accounts payable, accrued liabilities, operating lease liabilities and other current and non-current liabilities	(213)		(526)
Cash provided (used) by operations	4,810		3,588
Cash provided (used) by investing activities:
Purchases of short-term investments	(3,337)		(4,844)
Maturities of short-term investments	2,036		2,470
Sales of short-term investments	3,093		3,149
Additions to property, plant and equipment	(599)		(700)
Other investing activities	(9)		62
Cash provided (used) by investing activities	1,184		137
Cash provided (used) by financing activities:
Increase (decrease) in notes payable, net	—		4
Proceeds from exercise of stock options and other stock issuances	477		413
Repurchase of common stock	(3,214)		(4,101)
Dividends — common and preferred	(1,609)		(1,488)
Other financing activities	(122)		(94)
Cash provided (used) by financing activities	(4,468)		(5,266)
Effect of exchange rate changes on cash and equivalents	(7)		(78)
Net increase (decrease) in cash and equivalents	1,519		(1,619)
Cash and equivalents, beginning of period	7,441		8,574
CASH AND EQUIVALENTS, END OF PERIOD	$	8,960	$	6,955
Supplemental disclosure of cash flow information:
Non-cash additions to property, plant and equipment	$	177	$	145
Dividends declared and not paid	561		527

The accompanying Notes to the Unaudited Condensed Consolidated Financial Statements are an integral part of this statement.

NIKE, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY


	COMMON STOCK						CAPITAL IN EXCESS OF STATED VALUE		ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)		RETAINED EARNINGS		TOTAL
	CLASS A			CLASS B
(In millions, except per share data)	SHARES	AMOUNT		SHARES	AMOUNT
Balance at November 30, 2023	298	$	—	1,219	$	3	$	12,871	$	121	$	1,151	$	14,146
Stock options exercised				2			135						135
Repurchase of Class B Common Stock				(8)			(67)				(799)		(866)
Dividends on common stock ($0.370 per share)											(561)		(561)
Issuance of shares to employees, net of shares withheld for employee taxes							(27)				7		(20)
Stock-based compensation							216						216
Net income											1,172		1,172
Other comprehensive income (loss)									4				4
Balance at February 29, 2024	298	$	—	1,213	$	3	$	13,128	$	125	$	970	$	14,226


	COMMON STOCK						CAPITAL IN EXCESS OF STATED VALUE		ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)		RETAINED EARNINGS		TOTAL
	CLASS A			CLASS B
(In millions, except per share data)	SHARES	AMOUNT		SHARES	AMOUNT
Balance at November 30, 2022	305	$	—	1,245	$	3	$	11,851	$	559	$	2,859	$	15,272
Stock options exercised				3			153						153
Repurchase of Class B Common Stock				(13)			(99)				(1,420)		(1,519)
Dividends on common stock ($0.340 per share)											(527)		(527)
Issuance of shares to employees, net of shares withheld for employee taxes							(23)				—		(23)
Stock-based compensation							192						192
Net income											1,240		1,240
Other comprehensive income (loss)									(257)				(257)
Balance at February 28, 2023	305	$	—	1,235	$	3	$	12,074	$	302	$	2,152	$	14,531


	COMMON STOCK						CAPITAL IN EXCESS OF STATED VALUE		ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)		RETAINED EARNINGS		TOTAL
	CLASS A			CLASS B
(In millions, except per share data)	SHARES	AMOUNT		SHARES	AMOUNT
Balance at May 31, 2023	305	$	—	1,227	$	3	$	12,412	$	231	$	1,358	$	14,004
Stock options exercised				6			347						347
Conversion to Class B Common Stock	(7)			7									—
Repurchase of Class B Common Stock				(30)			(251)				(2,956)		(3,207)
Dividends on common stock ($1.080 per share) and preferred stock ($0.10 per share)											(1,645)		(1,645)
Issuance of shares to employees, net of shares withheld for employee taxes				3			2				13		15
Stock-based compensation							618						618
Net income											4,200		4,200
Other comprehensive income (loss)									(106)				(106)
Balance at February 29, 2024	298	$	—	1,213	$	3	$	13,128	$	125	$	970	$	14,226


	COMMON STOCK						CAPITAL IN EXCESS OF STATED VALUE		ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)		RETAINED EARNINGS		TOTAL
	CLASS A			CLASS B
(In millions, except per share data)	SHARES	AMOUNT		SHARES	AMOUNT
Balance at May 31, 2022	305	$	—	1,266	$	3	$	11,484	$	318	$	3,476	$	15,281
Stock options exercised				6			302						302
Repurchase of Class B Common Stock				(39)			(288)				(3,829)		(4,117)
Dividends on common stock ($0.985 per share) and preferred stock ($0.10 per share)											(1,535)		(1,535)
Issuance of shares to employees, net of shares withheld for employee taxes				2			20				1		21
Stock-based compensation							556						556
Net income											4,039		4,039
Other comprehensive income (loss)									(16)				(16)
Balance at February 28, 2023	305	$	—	1,235	$	3	$	12,074	$	302	$	2,152	$	14,531

The accompanying Notes to the Unaudited Condensed Consolidated Financial Statements are an integral part of this statement.

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


NOTE 1	Summary of Significant Accounting Policies	8
NOTE 2	Accrued Liabilities	9
NOTE 3	Fair Value Measurements	9
NOTE 4	Short-Term Borrowings and Credit Lines	11
NOTE 5	Income Taxes	11
NOTE 6	Stock-Based Compensation	12
NOTE 7	Earnings Per Share	13
NOTE 8	Risk Management and Derivatives	14
NOTE 9	Accumulated Other Comprehensive Income (Loss)	17
NOTE 10	Revenues	19
NOTE 11	Operating Segments	21
NOTE 12	Contingencies	23
NOTE 13	Acquisitions and Divestitures	23
NOTE 14	Restructuring	24


NOTE 1 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF PRESENTATION

The Unaudited Condensed Consolidated Financial Statements include the accounts of NIKE, Inc. and its subsidiaries (the "Company" or "NIKE") and reflect all normal recurring 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 Condensed Consolidated Balance Sheet data as of May 31, 2023, was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America ("U.S. GAAP"). The interim financial information and notes thereto should be read in conjunction with the Company's 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 nine months ended February 29, 2024, are not necessarily indicative of results to be expected for the entire fiscal year.

RECENTLY ISSUED ACCOUNTING STANDARDS AND DISCLOSURE RULES

In November 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 disclosures about significant expenses. The amendments will require public entities to disclose significant segment expenses that are regularly provided to the chief operating decision maker and included within segment profit and loss. The amendments are effective for the Company's annual periods beginning June 1, 2024, and interim periods beginning June 1, 2025, with early adoption permitted, and will be applied retrospectively to all prior periods presented in the financial statements. The Company is currently evaluating the ASU to determine its impact on the Company's disclosures.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which includes amendments that further enhance income tax disclosures, primarily through standardization and disaggregation of rate reconciliation categories and income taxes paid by jurisdiction. The amendments are effective for the Company's annual periods beginning June 1, 2025, with early adoption permitted, and should be applied either prospectively or retrospectively. The Company is currently evaluating the ASU to determine its impact on the Company's disclosures.

In March 2024, the U.S. Securities and Exchange Commission ("SEC") adopted the final rule under SEC Release No. 33-11275, The Enhancement and Standardization of Climate-Related Disclosures for Investors. This rule will require registrants to disclose certain climate-related information in registration statements and annual reports. The disclosure requirements will apply to the Company's fiscal year beginning June 1, 2025. The Company is currently evaluating the final rule to determine its impact on the Company's disclosures.

RECENTLY ADOPTED ACCOUNTING STANDARDS

In September 2022, the FASB issued ASU 2022-04, Liabilities — Supplier Finance Programs (Subtopic 405-50): Disclosure of Supplier Finance Program Obligations. The new guidance requires qualitative and quantitative disclosure sufficient to enable users of the financial statements to understand the nature, activity during the period, changes from 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 option to finance valid payment obligations from the Company. The Company is not a party to agreements negotiated between participating suppliers and third-party financial institutions. The Company's obligations to its suppliers, including amounts due and payment terms, are not affected by a supplier's decision to participate in these programs and the Company does not provide guarantees to third parties in connection with these programs. As of February 29, 2024 and May 31, 2023, the Company had $704 million and $834 million, respectively, of outstanding supplier obligations confirmed as valid under these programs. These amounts are included within Accounts payable on the Unaudited Condensed Consolidated Balance Sheets.


NOTE 2 — ACCRUED LIABILITIES

Accrued liabilities included the following:


	FEBRUARY 29,		MAY 31,
(Dollars in millions)	2024		2023
Compensation and benefits, excluding taxes	$	1,254	$	1,737
Sales-related reserves	1,227		994
Dividends payable	566		529
Endorsement compensation	493		552

Other	2,278		1,911
TOTAL ACCRUED LIABILITIES	$	5,818	$	5,723


NOTE 3 — FAIR VALUE MEASUREMENTS

The Company measures certain financial assets and liabilities at fair value on a recurring basis, including derivatives, equity securities and available-for-sale debt securities. For additional information about the Company's fair value policies, refer to Note 1 — Summary of Significant Accounting Policies within the Annual Report.

The following tables present information about the Company's financial assets measured at fair value on a recurring basis as of February 29, 2024 and May 31, 2023, and indicate the level in the fair value hierarchy in which the Company classifies the fair value measurement:


	FEBRUARY 29, 2024
(Dollars in millions)	ASSETS AT FAIR VALUE		CASH AND EQUIVALENTS		SHORT-TERM INVESTMENTS
Cash	$	1,118	$	1,118	$	—
Level 1:
U.S. Treasury securities	1,002		1		1,001
Level 2:
Commercial paper and bonds	580		18		562
Money market funds	7,272		7,272		—
Time deposits	560		551		9
U.S. Agency securities	41		—		41
Total Level 2	8,453		7,841		612
TOTAL	$	10,573	$	8,960	$	1,613


	MAY 31, 2023
(Dollars in millions)	ASSETS AT FAIR VALUE		CASH AND EQUIVALENTS		SHORT-TERM INVESTMENTS
Cash	$	1,767	$	1,767	$	—
Level 1:
U.S. Treasury securities	2,655		—		2,655
Level 2:
Commercial paper and bonds	543		15		528
Money market funds	5,157		5,157		—
Time deposits	507		502		5
U.S. Agency securities	46		—		46
Total Level 2	6,253		5,674		579
TOTAL	$	10,675	$	7,441	$	3,234

As of February 29, 2024, the Company held $867 million of available-for-sale debt securities with maturity dates within one year and $746 million with maturity dates greater than one year and less than five years in Short-term investments on the Unaudited Condensed Consolidated Balance Sheets. The fair value of the Company's available-for-sale debt securities approximates their amortized cost.

Included in Interest expense (income), net was interest income related to the Company's investment portfolio of $113 million and $83 million for the three months ended February 29, 2024 and February 28, 2023, respectively, and $304 million and $196 million for the nine months ended February 29, 2024 and February 28, 2023, respectively.

The following tables present information about the Company's derivative assets and liabilities measured at fair value on a recurring basis and indicate the level in the fair value hierarchy in which the Company classifies the fair value measurement:


	FEBRUARY 29, 2024
	DERIVATIVE ASSETS						DERIVATIVE LIABILITIES
(Dollars in millions)	ASSETS AT FAIR VALUE		OTHER CURRENT ASSETS		OTHER LONG-TERM ASSETS		LIABILITIES AT FAIR VALUE		ACCRUED LIABILITIES		OTHER LONG-TERM LIABILITIES
Level 2:
Foreign exchange forwards and options(1)	$	390	$	324	$	66	$	149	$	132	$	17
Interest rate swap contracts(1)	2		—		2		4		—		4
TOTAL	$	392	$	324	$	68	$	153	$	132	$	21

*(1)*If the derivative instruments had been netted on the Unaudited Condensed Consolidated Balance Sheets, the asset and liability positions each would have been reduced by $149 million as of February 29, 2024. As of that date, the Company received $48 million of cash collateral from counterparties related to derivative instruments. No amount of collateral was posted on the derivative liability balance as of February 29, 2024.


	MAY 31, 2023
	DERIVATIVE ASSETS						DERIVATIVE LIABILITIES
(Dollars in millions)	ASSETS AT FAIR VALUE		OTHER CURRENT ASSETS		OTHER LONG-TERM ASSETS		LIABILITIES AT FAIR VALUE		ACCRUED LIABILITIES		OTHER LONG-TERM LIABILITIES
Level 2:
Foreign exchange forwards and options(1)	$	557	$	493	$	64	$	180	$	128	$	52

*(1)*If the 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 million of cash collateral from counterparties related to derivative instruments. No amount of collateral was posted on the derivative liability balance as of May 31, 2023.

For additional information related to the Company's derivative financial instruments and credit risk, refer to Note 8 — Risk 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 VALUE

The Company's Long-term debt is recorded at adjusted cost, net of unamortized premiums, discounts, debt issuance costs and interest rate swap fair value adjustments. The fair value of long-term debt is estimated based upon quoted prices for similar instruments or quoted prices for identical instruments in inactive markets (Level 2). The fair value of the Company's Long-term debt was approximately $7,764 million at February 29, 2024 and $7,889 million at May 31, 2023.


NOTE 4 — SHORT-TERM BORROWINGS AND CREDIT LINES

The carrying amounts reflected on the Unaudited Condensed Consolidated Balance Sheets for Notes payable approximate fair value.

As of February 29, 2024 and May 31, 2023, the Company had no borrowings outstanding under its $3 billion commercial paper program.

On March 8, 2024, subsequent to the end of the third quarter of fiscal 2024, the Company entered into a 364-day committed credit facility agreement with a syndicate of banks, which provides for up to $1 billion of borrowings, with an option to increase borrowings up to $1.5 billion in total with lender approval. The facility matures on March 7, 2025, with an option to extend the maturity date an additional 364 days. This facility replaces the prior $1 billion 364-day credit facility agreement entered into on March 10, 2023, which matured on March 8, 2024. Based on the Company's current long-term senior unsecured debt ratings of AA- and A1 from Standard and Poor's Corporation and Moody's Investor Services, respectively, the interest rate charged on any outstanding borrowings would be the prevailing Term Secured Overnight Financing Rate (Term SOFR) for the applicable interest period plus 0.60%. The facility fee is 0.02% of the total undrawn commitment. As of April 4, 2024, no amounts were outstanding under this committed credit facility.

There have been no other changes to the credit lines reported in the Annual Report for the fiscal year ended May 31, 2023.


NOTE 5 — INCOME TAXES

The effective tax rate was 15.6% and 18.5% for the nine months ended February 29, 2024 and February 28, 2023, respectively. The decrease in the Company's effective tax rate was primarily 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 specifically delayed the application of certain U.S. foreign tax credit regulations that had previously limited the Company's 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-time tax benefit related to prior year tax positions in the first three months of fiscal 2024. Other one-time benefits included a reduction in accrued withholding taxes on undistributed foreign earnings recognized in the second quarter of fiscal 2024.

On August 16, 2022, the U.S. government enacted the Inflation Reduction Act of 2022 that included, among other provisions, changes to the U.S. corporate income tax system, including a fifteen percent minimum tax based on "adjusted financial statement income," which was effective for the Company beginning June 1, 2023. Based on the Company's current analysis of the provisions, these tax law changes are not expected to have a material impact on the Company's financial statements for fiscal 2024.

As of February 29, 2024, total gross unrecognized tax benefits, excluding related interest and penalties, were $988 million, $701 million of which would affect the Company's effective tax rate if recognized in future periods. The majority of the total gross unrecognized tax benefits are long-term in nature and included within Deferred income taxes and other liabilities on the Unaudited Condensed Consolidated Balance Sheets. As of May 31, 2023, total gross unrecognized tax benefits, excluding related interest and penalties, were $936 million. As of February 29, 2024 and May 31, 2023, accrued interest and penalties related to uncertain tax positions were $314 million and $268 million, respectively, (excluding federal benefit) and included within Deferred income taxes and other liabilities on the Unaudited Condensed Consolidated Balance 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 years 2017 through 2019. The Company has closed all U.S. federal income tax matters through fiscal 2016, with the exception 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 and foreign audit issues in the aggregate, along with the expiration of applicable statutes of limitations, and estimates that it is reasonably possible the total gross unrecognized tax benefits could decrease by up to $20 million within the next 12 months. In January 2019, the European Commission opened a formal investigation to examine whether the Netherlands has breached State Aid rules when granting certain tax rulings to the Company. The Company believes the investigation is without merit. If this matter is adversely resolved, the Netherlands may be required to assess additional amounts with respect to prior periods, and the Company's income taxes related to prior periods in the Netherlands could increase.


NOTE 6 — STOCK-BASED COMPENSATION

STOCK-BASED COMPENSATION

The 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 in connection with equity awards granted under the Stock Incentive Plan. The Stock Incentive Plan authorizes the grant of non-statutory stock options, incentive stock options, stock appreciation rights and stock awards, including restricted stock and restricted stock units. Restricted stock units include both time-vesting restricted stock units ("RSUs") as well as performance-based restricted stock units ("PSUs"). In addition to the Stock Incentive Plan, the Company gives employees the right to purchase shares 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 the Annual Report.

The following table summarizes the Company's total stock-based compensation expense recognized in Cost of sales or Operating overhead expense, as applicable:


	THREE MONTHS ENDED				NINE MONTHS ENDED
(Dollars in millions)	FEBRUARY 29, 2024		FEBRUARY 28, 2023		FEBRUARY 29, 2024		FEBRUARY 28, 2023
Stock options(1)	$	89	$	78	$	253	$	232
ESPPs	17		20		55		53
Restricted stock and restricted stock units(2)	110		94		310		271
TOTAL STOCK-BASED COMPENSATION EXPENSE	$	216	$	192	$	618	$	556

*(1)*Expense for stock options includes the expense associated with stock appreciation rights.

*(2)*Restricted stock units include RSUs and PSUs.

The income tax benefit related to stock-based compensation expense was $12 million and $22 million for the three months ended February 29, 2024 and February 28, 2023, respectively, and $30 million and $44 million for the nine months ended February 29, 2024 and February 28, 2023, respectively, and reported within Income tax expense.

STOCK OPTIONS

As of February 29, 2024, the Company had $478 million of unrecognized compensation costs from stock options, net of estimated forfeitures, to be recognized in Cost of sales or Operating overhead expense, as applicable, over a weighted average remaining period of 2.6 years.

RESTRICTED STOCK AND RESTRICTED STOCK UNITS

As of February 29, 2024, the Company had $699 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 2.5 years.


NOTE 7 — EARNINGS PER SHARE

The following is a reconciliation from basic earnings per common share to diluted earnings per common share. The computations of diluted earnings per common share exclude restricted stock, restricted stock units and options, including shares under ESPPs, to purchase an estimated additional 40.9 million and 29.5 million shares of common stock outstanding for the three months ended February 29, 2024 and February 28, 2023, respectively, and 42.6 million and 31.8 million shares of common stock outstanding for the nine months ended February 29, 2024 and February 28, 2023, respectively, because the awards were assumed to be anti-dilutive.


	THREE MONTHS ENDED				NINE MONTHS ENDED
(In millions, except per share data)	FEBRUARY 29, 2024		FEBRUARY 28, 2023		FEBRUARY 29, 2024		FEBRUARY 28, 2023
Net income available to common stockholders	$	1,172	$	1,240	$	4,200	$	4,039
Determination of shares:
Weighted average common shares outstanding	1,513.2		1,543.8		1,520.8		1,556.7
Assumed conversion of dilutive stock options and awards	13.3		21.0		13.2		17.7
DILUTED WEIGHTED AVERAGE COMMON SHARES OUTSTANDING	1,526.5		1,564.8		1,534.0		1,574.4
Earnings per common share:
Basic	$	0.77	$	0.80	$	2.76	$	2.59
Diluted	$	0.77	$	0.79	$	2.74	$	2.57


NOTE 8 — RISK MANAGEMENT AND DERIVATIVES

The Company is exposed to global market risks, including the effect of changes in foreign currency exchange rates and interest rates, and uses derivatives to manage financial exposures that occur in the normal course of business. As of and for the nine months ended February 29, 2024, there have been no material changes to the Company's hedging program or strategy from what was disclosed within the Annual Report. For additional information about the Company's derivatives and hedging policies, refer to Note 1 — Summary of Significant Accounting Policies and Note 12 — Risk Management and Derivatives within the Annual Report.

The majority of derivatives outstanding as of February 29, 2024, 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 Consolidated Balance Sheets at fair value and classified based on the instrument's maturity date.

The following tables present the fair values of derivative instruments included within the Unaudited Condensed Consolidated Balance Sheets:


	DERIVATIVE ASSETS
	BALANCE SHEET LOCATION	FEBRUARY 29,			MAY 31,
(Dollars in millions)	2024			2023
Derivatives formally designated as hedging instruments:
Foreign exchange forwards and options	Prepaid expenses and other current assets	$	312		$	480
Foreign exchange forwards and options	Deferred income taxes and other assets	66			64
Interest rate swap contracts	Deferred income taxes and other assets	2			—
Total derivatives formally designated as hedging instruments		380			544
Derivatives not designated as hedging instruments:
Foreign exchange forwards and options	Prepaid expenses and other current assets	12			13



Total derivatives not designated as hedging instruments		12			13
TOTAL DERIVATIVE ASSETS		$	392		$	557

	DERIVATIVE LIABILITIES
	BALANCE SHEET LOCATION	FEBRUARY 29,			MAY 31,
(Dollars in millions)	2024			2023
Derivatives formally designated as hedging instruments:
Foreign exchange forwards and options	Accrued liabilities	$	121		$	93
Foreign exchange forwards and options	Deferred income taxes and other liabilities	17			52
Interest rate swap contracts	Deferred income taxes and other liabilities	4			—
Total derivatives formally designated as hedging instruments		142			145
Derivatives not designated as hedging instruments:
Foreign exchange forwards and options	Accrued liabilities	11			35



Total derivatives not designated as hedging instruments		11			35
TOTAL DERIVATIVE LIABILITIES		$	153		$	180

The following tables present the amounts affecting the Unaudited Condensed Consolidated Statements of Income:


(Dollars in millions)	AMOUNT OF GAIN (LOSS) RECOGNIZED IN OTHER COMPREHENSIVE INCOME (LOSS) ON DERIVATIVES(1)					AMOUNT OF GAIN (LOSS) RECLASSIFIED FROM ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) INTO INCOME(1)
THREE MONTHS ENDED					LOCATION OF GAIN (LOSS) RECLASSIFIED FROM ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) INTO INCOME		THREE MONTHS ENDED
FEBRUARY 29, 2024	FEBRUARY 28, 2023					FEBRUARY 29, 2024	FEBRUARY 28, 2023
Derivatives designated as cash flow hedges:
Foreign exchange forwards and options	$	(32)	$	30		Revenues		$	(10)	$	14
Foreign exchange forwards and options	135		(141)			Cost of sales		70		182
Foreign exchange forwards and options	—		1			Demand creation expense		1		(1)
Foreign exchange forwards and options	49		(65)			Other (income) expense, net		52		90
Interest rate swaps(2)	—		—			Interest expense (income), net		(2)		(2)
TOTAL DESIGNATED CASH FLOW HEDGES	$	152	$	(175)				$	111	$	283

*(1)*For the three months ended February 29, 2024 and February 28, 2023, the amounts recorded in Other (income) expense, net as a result of the discontinuance of cash flow hedges because the forecasted transactions 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 Accumulated other comprehensive income (loss), will be released through Interest expense (income), net over the term of the issued debt.


(Dollars in millions)	AMOUNT OF GAIN (LOSS) RECOGNIZED IN OTHER COMPREHENSIVE INCOME (LOSS) ON DERIVATIVES(1)					AMOUNT OF GAIN (LOSS) RECLASSIFIED FROM ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) INTO INCOME(1)
NINE MONTHS ENDED					LOCATION OF GAIN (LOSS) RECLASSIFIED FROM ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) INTO INCOME		NINE MONTHS ENDED
FEBRUARY 29, 2024	FEBRUARY 28, 2023					FEBRUARY 29, 2024	FEBRUARY 28, 2023
Derivatives designated as cash flow hedges:
Foreign exchange forwards and options	$	(55)	$	52		Revenues		$	(7)	$	9
Foreign exchange forwards and options	154		245			Cost of sales		221		464
Foreign exchange forwards and options	2		(2)			Demand creation expense		1		(4)
Foreign exchange forwards and options	78		181			Other (income) expense, net		138		297
Interest rate swaps(2)	—		—			Interest expense (income), net		(6)		(6)
TOTAL DESIGNATED CASH FLOW HEDGES	$	179	$	476				$	347	$	760

*(1)*For the nine months ended February 29, 2024 and February 28, 2023, the amounts recorded in Other (income) expense, net as a result of the discontinuance of cash flow hedges because the forecasted transactions were no longer probable of occurring were immaterial.


	AMOUNT OF GAIN (LOSS) RECOGNIZED IN INCOME ON DERIVATIVES								LOCATION OF GAIN (LOSS) RECOGNIZED IN INCOME ON DERIVATIVES
	THREE MONTHS ENDED				NINE MONTHS ENDED
(Dollars in millions)	FEBRUARY 29, 2024		FEBRUARY 28, 2023		FEBRUARY 29, 2024		FEBRUARY 28, 2023


Derivatives not designated as hedging instruments:
Foreign exchange forwards and options and embedded derivatives	$	9	$	(26)	$	(1)	$	52	Other (income) expense, net

CASH FLOW HEDGES

The total notional amount of outstanding foreign currency derivatives designated as cash flow hedges was approximately $17.6 billion as of February 29, 2024. Approximately $250 million of deferred net gains (net of tax) on both outstanding and matured derivatives in Accumulated other comprehensive income (loss) as of February 29, 2024, are expected to be reclassified to Net income during the next 12 months concurrent with the underlying hedged transactions also being recorded in Net income. Actual amounts ultimately reclassified to Net income are dependent on the exchange rates in effect when derivative contracts currently outstanding mature. As of February 29, 2024, the maximum term over which the Company hedges exposures to the variability of cash flows for its forecasted transactions was 27 months.

FAIR VALUE HEDGES

The total notional amount of outstanding interest rate swap contracts designated as fair value hedges was $901 million as of February 29, 2024.

UNDESIGNATED DERIVATIVE INSTRUMENTS

The total notional amount of outstanding undesignated derivative instruments was $3.9 billion as of February 29, 2024.

CREDIT RISK

As of February 29, 2024, the Company was in compliance with all credit risk-related contingent features, and derivative instruments with such features were in a net asset position of approximately $239 million. Accordingly, the Company was not required to post cash collateral as a result of these contingent features. Further, $48 million of collateral was received on the Company's derivative asset balance as of February 29, 2024. The Company considers the impact of the risk of counterparty default to be immaterial.

For additional information related to the Company's derivative financial instruments and collateral, refer to Note 3 — Fair Value Measurements.


NOTE 9 — ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

The changes in Accumulated other comprehensive income (loss), net of tax, were as follows:


(Dollars in millions)	FOREIGN CURRENCY TRANSLATION ADJUSTMENT(1)		CASH FLOW HEDGES		NET INVESTMENT HEDGES(1)		OTHER		TOTAL
Balance at November 30, 2023	$	(178)	$	242	$	115	$	(58)	$	121
Other comprehensive income (loss):
Other comprehensive gains (losses) before reclassifications(2)	(57)		150		—		4		97
Reclassifications to net income of previously deferred (gains) losses(2)	—		(100)		—		7		(93)
Total other comprehensive income (loss)	(57)		50		—		11		4
Balance at February 29, 2024	$	(235)	$	292	$	115	$	(47)	$	125

*(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 upon complete or substantially complete liquidation of the respective entity.

*(2)*Net of immaterial tax impact.


(Dollars in millions)	FOREIGN CURRENCY TRANSLATION ADJUSTMENT(1)		CASH FLOW HEDGES		NET INVESTMENT HEDGES(1)		OTHER		TOTAL
Balance at November 30, 2022	$	(392)	$	933	$	115	$	(97)	$	559
Other comprehensive income (loss):
Other comprehensive gains (losses) before reclassifications(2)	150		(179)		—		—		(29)
Reclassifications to net income of previously deferred (gains) losses(2)	3		(254)		—		23		(228)
Total other comprehensive income (loss)	153		(433)		—		23		(257)
Balance at February 28, 2023	$	(239)	$	500	$	115	$	(74)	$	302

*(2)*Net of immaterial tax impact.


(Dollars in millions)	FOREIGN CURRENCY TRANSLATION ADJUSTMENT(1)		CASH FLOW HEDGES		NET INVESTMENT HEDGES(1)		OTHER		TOTAL
Balance at May 31, 2023	$	(253)	$	431	$	115	$	(62)	$	231
Other comprehensive income (loss):
Other comprehensive gains (losses) before reclassifications(2)	16		175		—		15		206
Reclassifications to net income of previously deferred (gains) losses(2)	2		(314)		—		—		(312)
Total other comprehensive income (loss)	18		(139)		—		15		(106)
Balance at February 29, 2024	$	(235)	$	292	$	115	$	(47)	$	125

*(2)*Net of immaterial tax impact.


(Dollars in millions)	FOREIGN CURRENCY TRANSLATION ADJUSTMENT(1)		CASH FLOW HEDGES		NET INVESTMENT HEDGES(1)		OTHER		TOTAL
Balance at May 31, 2022	$	(520)	$	779	$	115	$	(56)	$	318
Other comprehensive income (loss):
Other comprehensive gains (losses) before reclassifications(2)	(77)		399		—		(27)		295
Reclassifications to net income of previously deferred (gains) losses(2)	358		(678)		—		9		(311)
Total other comprehensive income (loss)	281		(279)		—		(18)		(16)
Balance at February 28, 2023	$	(239)	$	500	$	115	$	(74)	$	302

*(2)*Net of immaterial tax impact.

The following table summarizes the reclassifications from Accumulated other comprehensive income (loss) to the Unaudited Condensed Consolidated Statements of Income:


	AMOUNT OF GAIN (LOSS) RECLASSIFIED FROM ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) INTO INCOME								LOCATION OF GAIN (LOSS) RECLASSIFIED FROM ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) INTO INCOME
	THREE MONTHS ENDED				NINE MONTHS ENDED
(Dollars in millions)	FEBRUARY 29, 2024		FEBRUARY 28, 2023		FEBRUARY 29, 2024		FEBRUARY 28, 2023
Gains (losses) on foreign currency translation adjustment	$	—	$	(3)	$	(2)	$	(374)	Other (income) expense, net
Total before tax	—		(3)		(2)		(374)
Tax (expense) benefit	—		—		—		16
Gain (loss) net of tax	—		(3)		(2)		(358)
Gains (losses) on cash flow hedges:
Foreign exchange forwards and options	(10)		14		(7)		9		Revenues
Foreign exchange forwards and options	70		182		221		464		Cost of sales
Foreign exchange forwards and options	1		(1)		1		(4)		Demand creation expense
Foreign exchange forwards and options	52		90		138		297		Other (income) expense, net
Interest rate swaps	(2)		(2)		(6)		(6)		Interest expense (income), net
Total before tax	111		283		347		760
Tax (expense) benefit	(11)		(29)		(33)		(82)
Gain (loss) net of tax	100		254		314		678
Gains (losses) on other	(9)		(32)		1		(12)		Other (income) expense, net
Total before tax	(9)		(32)		1		(12)
Tax (expense) benefit	2		9		(1)		3
Gain (loss) net of tax	(7)		(23)		—		(9)
Total net gain (loss) reclassified for the period	$	93	$	228	$	312	$	311


NOTE 10 — REVENUES

DISAGGREGATION OF REVENUES

The following tables present the Company's Revenues disaggregated by reportable operating segment, major product line and distribution channel:


	THREE MONTHS ENDED FEBRUARY 29, 2024
(Dollars in millions)	NORTH AMERICA		EUROPE, MIDDLE EAST & AFRICA		GREATER CHINA		ASIA PACIFIC & LATIN AMERICA		GLOBAL BRAND DIVISIONS		TOTAL NIKE BRAND		CONVERSE		CORPORATE		TOTAL NIKE, INC.
Revenues by:
Footwear	$	3,460	$	1,960	$	1,547	$	1,195	$	—	$	8,162	$	426	$	—	$	8,588
Apparel	1,408		994		498		390		—		3,290		25		—		3,315
Equipment	202		184		39		62		—		487		9		—		496
Other	—		—		—		—		9		9		35		(14)		30
TOTAL REVENUES	$	5,070	$	3,138	$	2,084	$	1,647	$	9	$	11,948	$	495	$	(14)	$	12,429
Revenues by:
Sales to Wholesale Customers	$	2,440	$	1,966	$	1,243	$	939	$	—	$	6,588	$	257	$	—	$	6,845
Sales through Direct to Consumer	2,630		1,172		841		708		—		5,351		203		—		5,554
Other	—		—		—		—		9		9		35		(14)		30
TOTAL REVENUES	$	5,070	$	3,138	$	2,084	$	1,647	$	9	$	11,948	$	495	$	(14)	$	12,429


	THREE MONTHS ENDED FEBRUARY 28, 2023
(Dollars in millions)	NORTH AMERICA		EUROPE, MIDDLE EAST & AFRICA		GREATER CHINA		ASIA PACIFIC & LATIN AMERICA		GLOBAL BRAND DIVISIONS		TOTAL NIKE BRAND		CONVERSE		CORPORATE		TOTAL NIKE, INC.
Revenues by:
Footwear	$	3,322	$	2,011	$	1,496	$	1,141	$	—	$	7,970	$	540	$	—	$	8,510
Apparel	1,419		1,094		461		407		—		3,381		29		—		3,410
Equipment	172		141		37		53		—		403		6		—		409
Other	—		—		—		—		12		12		37		12		61
TOTAL REVENUES	$	4,913	$	3,246	$	1,994	$	1,601	$	12	$	11,766	$	612	$	12	$	12,390
Revenues by:
Sales to Wholesale Customers	$	2,323	$	2,061	$	1,126	$	913	$	—	$	6,423	$	323	$	—	$	6,746
Sales through Direct to Consumer	2,590		1,185		868		688		—		5,331		252		—		5,583
Other	—		—		—		—		12		12		37		12		61
TOTAL REVENUES	$	4,913	$	3,246	$	1,994	$	1,601	$	12	$	11,766	$	612	$	12	$	12,390


	NINE MONTHS ENDED FEBRUARY 29, 2024
(Dollars in millions)	NORTH AMERICA		EUROPE, MIDDLE EAST & AFRICA		GREATER CHINA		ASIA PACIFIC & LATIN AMERICA		GLOBAL BRAND DIVISIONS		TOTAL NIKE BRAND		CONVERSE		CORPORATE		TOTAL NIKE, INC.
Revenues by:
Footwear	$	10,950	$	6,406	$	4,195	$	3,639	$	—	$	25,190	$	1,390	$	—	$	26,580
Apparel	4,555		3,331		1,368		1,198		—		10,452		75		—		10,527
Equipment	613		578		119		187		—		1,497		27		—		1,524
Other	—		—		—		—		34		34		110		(19)		125
TOTAL REVENUES	$	16,118	$	10,315	$	5,682	$	5,024	$	34	$	37,173	$	1,602	$	(19)	$	38,756
Revenues by:
Sales to Wholesale Customers	$	8,114	$	6,483	$	3,165	$	2,927	$	—	$	20,689	$	843	$	—	$	21,532
Sales through Direct to Consumer	8,004		3,832		2,517		2,097		—		16,450		649		—		17,099
Other	—		—		—		—		34		34		110		(19)		125
TOTAL REVENUES	$	16,118	$	10,315	$	5,682	$	5,024	$	34	$	37,173	$	1,602	$	(19)	$	38,756


	NINE MONTHS ENDED FEBRUARY 28, 2023
(Dollars in millions)	NORTH AMERICA		EUROPE, MIDDLE EAST & AFRICA		GREATER CHINA		ASIA PACIFIC & LATIN AMERICA		GLOBAL BRAND DIVISIONS		TOTAL NIKE BRAND		CONVERSE		CORPORATE		TOTAL NIKE, INC.
Revenues by:
Footwear	$	11,090	$	6,086	$	4,099	$	3,313	$	—	$	24,588	$	1,633	$	—	$	26,221
Apparel	4,598		3,528		1,228		1,255		—		10,609		70		—		10,679
Equipment	565		454		111		167		—		1,297		21		—		1,318
Other	—		—		—		—		44		44		117		13		174
TOTAL REVENUES	$	16,253	$	10,068	$	5,438	$	4,735	$	44	$	36,538	$	1,841	$	13	$	38,392
Revenues by:
Sales to Wholesale Customers	$	8,533	$	6,506	$	2,862	$	2,792	$	—	$	20,693	$	971	$	—	$	21,664
Sales through Direct to Consumer	7,720		3,562		2,576		1,943		—		15,801		753		—		16,554
Other	—		—		—		—		44		44		117		13		174
TOTAL REVENUES	$	16,253	$	10,068	$	5,438	$	4,735	$	44	$	36,538	$	1,841	$	13	$	38,392

For the three and nine months ended February 29, 2024 and three and nine months ended February 28, 2023, Global Brand Divisions revenues included NIKE Brand licensing and other miscellaneous revenues that are not part of a geographic operating segment. Converse Other revenues were primarily attributable to licensing businesses. Corporate revenues primarily consisted 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.

As of February 29, 2024 and May 31, 2023, the Company did not have any contract assets and had an immaterial amount of contract liabilities recorded in Accrued liabilities on the Unaudited Condensed Consolidated Balance Sheets.


NOTE 11 — OPERATING SEGMENTS

The Company's operating segments are evidence of the structure of the Company's internal organization. The NIKE Brand segments are defined by geographic regions for operations participating in NIKE Brand sales activity.

Each NIKE Brand geographic segment operates predominantly in one industry: the design, development, marketing and selling of athletic footwear, apparel and equipment. The Company's reportable operating segments for the NIKE Brand are: North America; Europe, Middle East & Africa ("EMEA"); Greater China; and Asia Pacific & Latin America ("APLA"), and include results for the NIKE and Jordan brands.

The Company's NIKE Direct operations are managed within each NIKE Brand geographic operating segment. Converse is also a reportable segment for the Company and operates in one industry: the design, marketing, 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 Divisions revenues include NIKE Brand licensing and other miscellaneous revenues that are not part of a geographic operating segment. Global Brand Divisions costs represent demand creation and operating overhead expense that include product creation and design expenses centrally managed for the NIKE Brand, as well as costs associated with NIKE Direct global digital operations and enterprise technology.

Corporate consists primarily of unallocated general and administrative expenses, including expenses associated with centrally managed departments; depreciation and amortization related to the Company's 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 29, 2024, Corporate also includes pre-tax restructuring charges recognized as a result of the Company taking steps to streamline the organization. These pre-tax charges primarily reflect employee severance costs and accelerated stock-based compensation expense. For more information, refer to Note 14 — Restructuring.

The primary financial measure used by the Company to evaluate performance of individual operating segments is earnings before interest and taxes ("EBIT"), which represents Net income before Interest expense (income), net, and Income taxes in the Unaudited Condensed Consolidated Statements of Income.

As part of the Company's centrally managed foreign exchange risk management program, standard foreign currency rates are assigned twice per year to each NIKE Brand entity in the Company's geographic operating segments and to Converse. These rates are set approximately nine and twelve months in advance of the future selling 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 the spring and summer selling seasons) based on average market spot rates in the calendar month preceding the date they are established. Inventories and Cost of sales for geographic operating segments and Converse reflect the use of these standard rates to record non-functional currency product purchases in the entity's functional currency. Differences between assigned standard foreign currency rates and actual market rates are included in Corporate, together with foreign currency hedge gains and losses generated from the Company's centrally managed foreign exchange risk management program and other conversion gains and losses.

Accounts receivable, net, Inventories and Property, plant and equipment, net for operating segments are regularly reviewed by management and are therefore provided below.


	THREE MONTHS ENDED				NINE MONTHS ENDED
(Dollars in millions)	FEBRUARY 29, 2024		FEBRUARY 28, 2023		FEBRUARY 29, 2024		FEBRUARY 28, 2023
REVENUES
North America	$	5,070	$	4,913	$	16,118	$	16,253
Europe, Middle East & Africa	3,138		3,246		10,315		10,068
Greater China	2,084		1,994		5,682		5,438
Asia Pacific & Latin America	1,647		1,601		5,024		4,735
Global Brand Divisions	9		12		34		44
Total NIKE Brand	11,948		11,766		37,173		36,538
Converse	495		612		1,602		1,841
Corporate	(14)		12		(19)		13
TOTAL NIKE, INC. REVENUES	$	12,429	$	12,390	$	38,756	$	38,392
EARNINGS BEFORE INTEREST AND TAXES
North America	$	1,400	$	1,190	$	4,360	$	4,064
Europe, Middle East & Africa	734		785		2,591		2,750
Greater China	722		702		1,761		1,754
Asia Pacific & Latin America	471		485		1,406		1,470
Global Brand Divisions	(1,199)		(1,160)		(3,572)		(3,573)
Converse	98		164		380		526
Corporate	(874)		(696)		(2,060)		(2,014)
Interest expense (income), net	(52)		(7)		(108)		22
TOTAL NIKE, INC. INCOME BEFORE INCOME TAXES	$	1,404	$	1,477	$	4,974	$	4,955


	FEBRUARY 29,		MAY 31,
(Dollars in millions)	2024		2023
ACCOUNTS RECEIVABLE, NET
North America	$	1,872	$	1,653
Europe, Middle East & Africa	1,336		1,197
Greater China	197		162
Asia Pacific & Latin America	750		700
Global Brand Divisions	96		96
Total NIKE Brand	4,251		3,808
Converse	219		235
Corporate	56		88
TOTAL ACCOUNTS RECEIVABLE, NET	$	4,526	$	4,131
INVENTORIES
North America	$	3,201	$	3,806
Europe, Middle East & Africa	2,046		2,167
Greater China	1,121		973
Asia Pacific & Latin America	889		894
Global Brand Divisions	180		232
Total NIKE Brand	7,437		8,072
Converse	289		305
Corporate	—		77
TOTAL INVENTORIES(1)	$	7,726	$	8,454

*(1)*Inventories as of February 29, 2024 and May 31, 2023, were substantially all finished goods.


	FEBRUARY 29,		MAY 31,
(Dollars in millions)	2024		2023
PROPERTY, PLANT AND EQUIPMENT, NET
North America	$	760	$	794
Europe, Middle East & Africa	1,068		1,009
Greater China	264		292
Asia Pacific & Latin America	292		279
Global Brand Divisions	886		840
Total NIKE Brand	3,270		3,214
Converse	30		38
Corporate	1,782		1,829
TOTAL PROPERTY, PLANT AND EQUIPMENT, NET	$	5,082	$	5,081

NOTE 12 — CONTINGENCIES

In the ordinary course of business, the Company is subject to various legal proceedings, claims and government investigations relating to its business, products and actions of its employees and representatives, including contractual and employment relationships, product liability, antitrust, customs, tax, intellectual property and other matters. The outcome of these legal matters is inherently uncertain, and the Company cannot predict the eventual outcome of currently pending matters, the timing of their ultimate resolution or the eventual losses, fines, penalties or consequences relating to those matters. When a loss related to a legal proceeding or claim is probable and 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 the Company in a reporting period for amounts above management's expectations, the Company's financial position, operating results and cash flows for that reporting period could be materially adversely affected. In the opinion of management, based on its current knowledge and after consultation with counsel, the Company does not believe any currently pending legal matters will have a material adverse impact on the Company's results of operations, financial position or cash flows, except as described below.

BELGIAN CUSTOMS CLAIM

The Company has received claims for certain years from Belgian Customs and other government authorities for alleged underpaid duties related to products imported beginning in fiscal 2018. The Company disputes these claims and has engaged in the appellate process. The Company has issued bank guarantees in order to appeal the 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 reach a resolution on this matter. If this matter is ultimately resolved against the Company, the amounts owed, including fines, penalties and other consequences relating to the matter, could have a material adverse effect on the Company's results of operations, financial position and cash flows.

NOTE 13 — ACQUISITIONS AND DIVESTITURES

During the second quarter of fiscal 2023, the sale of the Company's entities in Argentina and Uruguay to a third-party distributor was completed and the net loss on the sale of these entities totaled approximately $550 million. This loss included $389 million, recognized primarily in fiscal 2020, largely due to the anticipated release of the cumulative foreign currency translation losses. The remaining loss recognized in fiscal 2023 was due to the devaluation of local currency and cash equivalents included in the transferred assets. Upon completion of the sale, the foreign currency translation losses recorded in Accumulated other comprehensive income (loss) were reclassified to Net income within Other (income) expense, net, on the Unaudited Condensed Consolidated Statements of Comprehensive Income along with the allowance for previously recognized losses recorded in Accrued liabilities. 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 14 — RESTRUCTURING

During the third quarter of fiscal 2024, the Company announced a multi-year enterprise initiative designed to accelerate its future growth. As part of this initiative, management is taking steps to streamline the organization which will include a net reduction in the Company's global workforce. As of February 29, 2024, the Company expects to recognize pre-tax restructuring charges of approximately $450 million, primarily associated with employee severance costs and accelerated stock-based compensation expense, the majority of which are expected to be recognized by the end of fiscal 2024. The related cash payments are expected to take place through the first half of fiscal 2025. The expected pre-tax charges are estimates and are subject to a number of assumptions and actual results may vary from the estimates provided.

During the third quarter of fiscal 2024, the Company recognized pre-tax restructuring charges of $403 million. These charges were classified within Corporate as follows:


	THREE MONTHS ENDED FEBRUARY 29, 2024
(Dollars in millions)	OPERATING OVERHEAD EXPENSE		COST OF SALES		TOTAL
Employee severance and related costs(1)	$	319	$	60	$	379
Stock-based compensation expense(2)	21		3		24
Total pre-tax restructuring charges	$	340	$	63	$	403

*(1)*Employee severance costs are recognized when a future related expense is considered probable and reasonably estimable.

*(2)*Non-cash restructuring related stock-based compensation expense is accelerated over the requisite service period, which for certain impacted employees could extend through the first half of fiscal 2025.

As of February 29, 2024, a majority of the $379 million of employee severance and related costs are reflected within Accrued liabilities on the Unaudited Condensed Consolidated Balance Sheets, classified within Other in Note 2 — Accrued Liabilities, and an immaterial amount is reflected within Accounts payable. As of February 29, 2024, the Company has not made any cash payments related to this activity.

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