DTC business and improved margins on closeout sales more than offset higher product input costs and unfavorable product mix. Selling and administrative expense increased due to higher operating overhead costs driven by increased investments to support DTC growth and our new Greater China headquarters in Shanghai, as well as higher demand creation spending. 

Japan 

Fiscal 2015 Compared to Fiscal 2014 

Constant currency revenues for Japan increased 9% in fiscal 2015, driven primarily by increases in Sportswear, Basketball and Running, partially offset by declines in Men’s Training, Golf and Women’s Training. DTC revenues grew 40% in fiscal 2015 driven by a 20% increase in comparable store sales, strong online sales growth and the addition of new stores. 

On a reported basis, fiscal 2015 EBIT decreased 24% compared to the prior year period, reflecting the impact of the weaker Yen. Gross margin decreased 270 basis points as unfavorable standard foreign currency exchange rates and higher product costs more than offset higher average selling prices and an increase in the proportion of revenues from our higher-margin DTC business. Selling and administrative expense increased as a percent of revenues as higher operating overhead, primarily to support our expanding DTC business, was only partially offset by a decrease in demand creation expense. 

Fiscal 2014 Compared to Fiscal 2013 

On a currency-neutral basis, revenues increased 5% for Japan, driven by higher revenues in Sportswear, Football (Soccer) and Basketball, partially offset by lower revenues in Men’s Training and Golf. 

Fiscal 2014 EBIT decreased 6% as a 12% decline in reported revenues, due to the weaker Yen, was only partially offset by higher gross margin and selling and administrative expense leverage. Gross margin increased 20 basis points as higher average selling prices, favorable off-price mix and the favorable impact of higher-margin DTC revenues were mostly offset by unfavorable standard foreign currency exchange rates. The decrease in selling and administrative expense in fiscal 2014 was attributable to lower operating overhead and demand creation spending. 

Emerging Markets 

Fiscal 2015 Compared to Fiscal 2014 

On a currency-neutral basis, fiscal 2015 revenues for Emerging Markets increased 8%, driven by growth in 7 of 9 territories. Growth was led by one of our largest territories, SOCO (which includes Argentina, Uruguay and Chile), which grew 28%, and our Pacific territory (which includes Australia and New Zealand), which grew 26%. Revenues in our Mexico and Brazil territories decreased 21% and 3%, respectively. The decrease in Mexico was attributable to efforts to liquidate excess inventory in the marketplace largely resulting from an inconsistent flow of product to customers following distribution center transition issues in fiscal 2014, while the decrease in Brazil was primarily due to challenging macroeconomic conditions and comparison to strong sales related to the World Cup in fiscal 2014. On a category basis, revenues were higher in most key categories, led by Sportswear, Running 

and Basketball, partially offset by a decline in Football (Soccer). DTC