and design world, I know something about the nature of innovation. It’s incredibly valuable, and equally difficult. That’s where this company distinguishes itself from all others: innovation. You can look back a year and see NIKE innovation at the World Cup in South Africa and the U.S. Open of Surfing in Huntington Beach, California. Look forward a year and you’ll see it in London at the Olympics and the NFL in the U.S. You’ll see it in Brazil in 2014 at the World Cup and in 2016 at the next summer Olympics, and you’ll see it every day in between.

We’re just beginning to tap into some huge, game-changing innovation: digital integration between athletes and technology, one-of-a-kind customization, open source design, and a quantum leap in engineering and manufacturing that closes the loop and opens the door to smarter products and more robust performance. This is the kind of change we’re focused on, and we are relentless about innovating to reach our full potential.



Mark Parker

President and Chief Executive Officer

NIKE, Inc.

Management’s Discussion and Analysis of Financial Condition and Results of Operations 

NIKE designs, develops, markets and sells high quality footwear, apparel, equipment and accessory products worldwide. We are the largest seller of athletic footwear and apparel in the world. We sell our products to retail accounts, through NIKE-owned retail stores and internet sales, which we refer to as our “Direct to Consumer” operations, and through a mix of independent distributors and licensees, worldwide. Our goal is to deliver value to our shareholders by building a profitable global portfolio of branded footwear, apparel, equipment and accessories businesses. Our strategy is to achieve long-term revenue growth by creating innovative, “must have” products, building deep personal consumer connections with our brands, and delivering compelling retail presentation and experiences. 

In addition to achieving long-term revenue growth, we continue to strive to deliver shareholder value by driving operational excellence in several key areas: 

Making our supply chain a competitive advantage through operational discipline, 

Reducing product costs through a continued focus on lean manufacturing and product design that strives to eliminate waste, 

Improving selling and administrative expense productivity by focusing on investments that drive economic returns in the form of incremental revenue and gross margin, and leveraging existing infrastructure across our portfolio of brands to eliminate duplicative costs, 

Improving working capital efficiency, and 

Deploying capital effectively to create value for our shareholders. 

 Through execution of this strategy, our long-term financial goals continue to be: 

High single-digit revenue growth, 

Mid-teens earnings per share growth, 

Increased return on invested capital and accelerated cash flows, and 

Consistent results through effective management of our diversified portfolio of businesses. 

Over the past ten years, we have achieved or exceeded all of these financial goals. During this time, NIKE, Inc’s revenues and earnings per share have grown 8% and 15%, respectively, on an