2014



CEO Letter to Shareholders



To Our Shareholders,



NIKE’s success is grounded in our ability to stay true to our mission. By bringing inspiration and innovation to every athlete, NIKE has grown from selling running shoes out of the back of a Plymouth Valiant into the world’s leading athletic footwear and apparel company. We’ve done this by continuously looking for new ways to unlock NIKE’s potential.



Just like the athletes we serve, NIKE is relentlessly focused on striving toward our full potential … by delivering break-through innovation in our products and services … by reaching new levels of sustainability as we enhance product performance … by developing deeper, more meaningful connections with our consumers … and by presenting our products in compelling experiences at retail. All of this helps us grow our business and deliver long-term value for our shareholders.



In fiscal year 2014, our focus on reaching toward our full potential drove great results across the business. Revenues grew 10% to $27.8 billion. Gross margin increased 120 basis points, despite a rising cost environment. And diluted earnings per share grew 11% to $2.97, outpacing revenue growth even in the face of significant currency headwinds throughout the year.



I take pride in our capacity to deliver results like these. And what is even more gratifying is that I am confident we will continue to deliver results like these in the future.



LEAD WITH INNOVATION

Much has changed in sports – and the business of sports – since NIKE was founded in 1972. But one thing that hasn’t changed is our passion for serving athletes by developing products and services that help them reach their full potential. Our unmatched ability to innovate is how we turn insights from athletes and consumers into amazing products and services that no one else can deliver, and this past year was no exception.



Together with Kobe in Los Angeles, we introduced the KOBE 9 Elite, extending the benefits of our NIKE Flyknit technology to Basketball;

At the Sochi Winter Games, we leveraged significant advances from several categories to deliver high-performance apparel, such as the lightweight hockey Game Jersey with NIKE Flywire and the NIKE Aeroloft 800 Summit Jacket with unmatched warmth and breathability;

At the Super Bowl in New York City, we launched the NIKE Vapor Carbon 2014 Elite Cleat, our first cleat to take advantage of the game-changing possibilities of 3-D printing;

At the world’s premier track meet – the Prefontaine Classic in Eugene, Oregon – NIKE athletes Ayanleh Souleiman, Galen Rupp and Shannon Rowbury set new U.S. records and world’s best times in our performance racing footwear; and

Leading up to the World Cup in Brazil, we launched 10 team kits that achieved new milestones in performance and sustainability. And we changed the game with ground-breaking boots, starting with the Hypervenom and Tiempo V. We then introduced the revolutionary Magista and Mercurial Superfly, which extended the benefits of NIKE Flyknit to the football pitch. This unmatched level of innovation was clearly evident on the field; at the start of the tournament we had more World Cup