Nike Inc. (NYSE:NKE)

Gross Profit Margin

The gross profit margin shows an overall increasing trend from August 2020, starting at 43.15%, peaking at 46.2% in February 2022. After this peak, a gradual decline is observed, reaching 41.94% by August 2025. This suggests that while the company initially improved its cost management or pricing strategy, the margin experiences some pressure in later periods.

Operating Profit Margin

The operating profit margin demonstrates a strong upward trajectory from 8.94% in August 2020 to a high of 15.79% in November 2021, indicating enhanced operational efficiency or favorable business conditions. Following this peak, the margin steadily declines each quarter, falling sharply to 7.36% in August 2025. This downward trend after November 2021 may indicate rising operating expenses or reduced profitability from core operations.

Net Profit Margin

The net profit margin follows a similar pattern to the operating margin, showing growth from 7.2% in August 2020 to a peak of 13.32% in November 2021. Thereafter, a steady decrease is evident, descending to 6.23% by August 2025. The decline in net margin suggests that despite earlier profitability improvements, the company faces challenges impacting its bottom-line profitability over time.

Return on Equity (ROE)

The ROE exhibits notable volatility with an initial value of 29.16% in August 2020, surging to a significant peak of 44.86% in May 2021. Subsequently, a downward trend persists, with ROE decreasing to 21.5% by August 2025. This reduction could reflect lower net income relative to shareholder equity or potentially increased equity base without proportional profit growth.

Return on Assets (ROA)

Return on assets starts at 8.09% in August 2020 and rises sharply to a peak of 16.04% in August and November 2021, indicating improved utilization of assets to generate profit. Thereafter, ROA declines gradually, reaching 7.75% in August 2025, pointing toward reduced efficiency in asset employment or pressure on overall profitability relative to total assets.

In summary, the company experienced strong profitability growth across margins and returns through late 2021, followed by a period of consistent decline across all key profitability ratios through mid-2025. This shift may signal emerging operational or market challenges impacting cost control, revenue generation, or asset utilization. Despite initial gains, these trends underscore the need for strategic initiatives to stabilize and improve profit margins and returns moving forward.

The financial trends over the reported periods reveal several key observations regarding profitability and revenue performance.

Gross Profit

Gross profit showed fluctuations throughout the periods, generally moving between approximately $4,469 million and $5,971 million. Notably, there were peaks around May and November 2023, where gross profit reached near $5,971 million and $5,971 million respectively, followed by a subsequent decline into 2024 and 2025. The earlier periods from 2020 into mid-2021 exhibited moderate growth, reaching a high point in May 2021 at about $5,655 million, indicating some recovery and expansion before the fluctuations began.

Revenues

Revenue trends demonstrate a moderate upward trajectory, peaking in November 2022 at approximately $13,388 million. Following this peak, revenues experienced a decline during 2024 and into 2025, reaching the lower end near $11,097 million. The initial period from 2020 to mid-2021 showed steady growth, reflecting improving sales, while the latter periods show some volatility and a potential contraction in the business volume or market conditions affecting revenue generation.

Gross Profit Margin

Gross profit margin percentages fluctuate within a range of about 41.94% to 46.2%. The margin peaked around February 2022 at 46.2%, suggesting efficient cost management or favorable pricing during this period. However, starting from 2023 and extending into 2025, the margin gradually declined, moving beneath 44% and approaching the lower 40% range. This downward trend in margin could imply rising costs, pricing pressures, or changes in product mix negatively impacting profitability ratios.

Overall, the data depicts a company experiencing growth phases with strong revenue and gross profit improvements through late 2021 into 2022, followed by a more challenging environment in subsequent years marked by decreasing gross profit margins and fluctuating revenue levels. This may signal emerging operational challenges or market headwinds impacting the company's financial efficiency and top-line performance.

The financial data over multiple quarters reveals several notable trends in the company's operating income, revenues, and operating profit margin. The analysis of these metrics provides insights into the company’s performance dynamics and operational efficiency over time.

Operating Income

Operating income exhibits considerable variability across the periods, with some marked fluctuations. Initially, the operating income shows a generally strong performance with values mostly above 1,400 million US dollars. However, there is a declining trend starting around early 2023, reaching a significant low point in May 2025 with an operating income of 321 million US dollars. Despite some recovery attempts towards the later quarters, the trend suggests challenges in maintaining consistent operating profitability.

Revenues

Revenues demonstrate a less volatile pattern compared to operating income, although there is fluctuation within a relatively narrow range. Revenues peak toward the end of 2022 and early 2023, reaching values above 13,000 million US dollars. After this peak, revenues generally trend downward, dipping below 12,000 million US dollars in several quarters by 2025, reflecting a weakening sales volume or pricing.

Operating Profit Margin

The operating profit margin displays a gradual decline throughout the periods analyzed. Initially, margins hover around 9% to 15%, with a peak margin of nearly 16% in mid-2021. This upward peak is followed by a steady decrease, reaching margins below 8% in the later quarters of 2024 and 2025. The consistent decrease in operating profit margin indicates rising costs relative to revenues or reduced pricing power, negatively impacting profitability.

In summary, while revenues remain relatively stable with minor fluctuations, operating income has faced significant downward pressure particularly in recent quarters. The decreasing trend in operating profit margin corroborates these observations, suggesting increasing operational challenges or market pressures affecting efficiency and profitability. The combination of these trends indicates a need for strategic focus on cost control, revenue enhancement, or productivity improvements to stabilize and improve financial performance moving forward.

Net Income Trends

Net income demonstrates notable fluctuations over the periods analyzed. It initially rises from 1,518 million USD in August 2020 to a peak of 1,874 million USD in August 2021. This is followed by a general downward trend, with intermittent rises, reaching notably low values of 211 million USD in May 2025 before partially recovering to 727 million USD in August 2025. This pattern suggests a period of volatility and challenges affecting profitability in the later quarters.

Revenue Patterns

Revenues show moderate variability but remain relatively stable compared to net income. From 10,594 million USD in August 2020, revenues generally increase, peaking at 13,388 million USD in November 2023. Following this peak, revenues display some decline and fluctuations, ending at 11,720 million USD in August 2025. Overall, the revenue trend is characterized by growth up to late 2023 followed by a mild contraction.

Net Profit Margin Dynamics

The net profit margin exhibits an upward trend early on, increasing from 7.2% in August 2020 to a high of approximately 13.32% in November 2021. Subsequently, the margin experiences a steady decline, dropping to 6.23% by August 2025. This decline in profitability margin despite revenue levels indicates increasing costs or reduced operational efficiency impacting the profitability per unit of revenue.

Interrelationship Between Metrics

The data reveals that while revenues showed growth trends particularly through late 2023, net income and profit margins lagged behind with more pronounced declines in more recent periods. The divergence suggests pressures on cost management or external market factors affecting profitability independent of sales volume. The sharp reduction in net income towards 2025 alongside decreased profit margins corroborates potential challenges in sustaining profit despite reasonable revenue levels.

Overall Assessment

The financial data indicates a strong performance phase up to late 2021 with increasing profitability and revenues. However, the subsequent periods reflect a phase of financial stress with diminishing net income and profit margins even as revenues maintained relative stability. Such trends highlight the necessity for enhanced cost control measures or strategic adjustments to restore and maintain profitability.

The analysis of the quarterly financial data reveals several notable trends regarding profitability, equity, and return on equity (ROE) over the period presented.

Net Income

Net income demonstrates significant fluctuation across the quarters. It peaked notably around August 2021 at 1,874 million USD and generally displayed a gradual decline thereafter, with intermittent recoveries. The most recent values near mid-2025 show a marked decrease, dropping to as low as 211 million USD, which indicates potential challenges in sustaining profit levels.

Shareholders’ Equity

Shareholders' equity shows a steady upward trend from 9,224 million USD in August 2020 to a peak of approximately 15,822 million USD in August 2022. Following this peak, equity slightly declined but remained relatively stable, hovering around the 13,000 to 14,000 million USD level towards the end of the timeline into mid-2025. This indicates a generally strong and consistent equity base, despite some minor contractions.

Return on Equity (ROE)

ROE exhibits a pattern of high performance initially, with values reaching above 40% in some quarters between 2021 and 2022, indicating efficient use of shareholders' equity to generate profits. Post mid-2022, there is a discernible downward trend in ROE, falling from the high 30% range down to approximately 21.5% by late 2025. This decline suggests decreasing profitability relative to the equity base, possibly reflecting the diminishing net income figures in the same period.

In summary, the data reveals a period where profitability and equity grew robustly, with very high returns on equity. However, more recent quarters indicate challenges with declining profitability and ROE, despite relatively stable equity levels. This divergence may warrant further investigation into operational efficiency, market conditions, or other factors affecting earnings capacity.

The financial performance over the analyzed quarters demonstrates several notable trends in profitability and asset utilization. Net income exhibits considerable volatility, with a peak occurring in the August 2021 quarter at approximately US$1,874 million, followed by a general downtrend interspersed with fluctuations reaching a low of US$211 million in May 2025 before a slight recovery to US$727 million by August 2025. This variability suggests challenges in maintaining consistent profitability during the period under review.

Total assets show a gradual increase from US$33,258 million in August 2020 to a peak near US$41,088 million in August 2022. Subsequently, there is a mild decline and some stability around the US$37,000 million range from early 2023 through most of 2025. This pattern indicates initial asset growth possibly tied to expansion or investment phases, followed by stabilization or asset optimization.

Return on Assets (ROA), expressed as a percentage, mirrors the fluctuations in net income but with less extreme variation. Starting at around 8.09% in August 2020, ROA rises to over 15% in mid-2021, suggesting improved efficiency in asset use to generate earnings. Post-2022, ROA trends downward, reaching a low near 7.75% by November 2025. This decline in ROA indicates diminishing profitability relative to the asset base, reflecting either lower net income, increased asset base without proportional income growth, or both.

Net Income

Exhibited a peak in mid-2021, followed by a generally downward and volatile trajectory, with pronounced decreases in 2024 and 2025.

Total Assets

Experienced steady growth through 2022 followed by a plateau and modest declines, suggesting tempering of asset buildup post-2022.

Return on Assets (ROA)

Improved significantly into 2021, reflecting enhanced asset efficiency, but declined gradually thereafter, potentially due to weakened net income or increased asset levels without matching earnings.

Overall, the data portrays a period of initial expansion and strong profitability efficiencies which were not sustained in recent quarters. The notable decline in net income and ROA in the latter stages indicates emerging profitability pressures, potentially requiring strategic focus on either cost management, revenue enhancement, or asset utilization improvements to restore prior performance levels.