The world’s leading athletic footwear and apparel maker Nike has announced a revenue target of $ 50 billion by the end of fiscal year 2020. During an investor meeting at its world headquarters near Beaverton, Oregon in the US, it also provided an overview of its progress on key strategic initiatives to achieve sustainable, profitable long-term growth.
Nike also shared its long-term financial model of high single-digit to low double-digit revenue growth, mid-teens earnings per share growth and expanding returns on invested capital, the company said.
“Nike is built for growth,” said Mark Parker, President and CEO of Nike, Inc. “We see tremendous growth potential in our key categories and geographies, as we connect with athletes through personal service, inspirational experiences and innovative product. When we look across our entire business, there has never been more opportunity.”
The company updated its projected long-term growth plans in the Nike Brand geographies through fiscal 2020. For its more developed geographies (North America, Western Europe and Japan), Nike now expects to generate average annual growth at a high single-digit rate over the next five years. It expects revenue in North America to reach $ 20 billion by the end of fiscal year 2020.
For its developing geographies (Emerging Markets, Greater China, and Central & Eastern Europe), Nike said it expects to grow at a low double-digit average annual growth rate for the next five years. The company expects its Emerging Markets geography to grow at a low double-digit average annual growth rate and for Greater China to grow at a mid-teens growth rate over the next five years, reaching $ 6.5 billion in revenue by the end of fiscal year 2020.
The company also provided an overview of its plans to drive growth in its Nike Brand Direct to Consumer (DTC) operations. Driven by its digital business as well as inline and factory stores, Nike now anticipates achieving $ 16 billion in revenue by the end of fiscal year 2020. Over the next five years incremental growth in DTC revenues is expected to be driven by e-commerce sales, which are projected to grow to $ 7 billion. Nike also expects to drive wholesale growth in the mid-to-high single-digit range over the next 5 years. (SH)