Nike Australia’s local business outperformed the global parent company in a fiscal year marked by economic headwinds, with total sales reaching nearly $1 billion for the first time.
Local sales rise while global growth stalls
New filings with ASIC show the Australian arm recorded $985.4 million in sales for the year ending May 31, up from $891.2 million the previous year. Profit after tax increased by roughly $1 million to land at $14.2 million.
Nike, Inc. reported flat sales growth of US$46.4 billion globally over the same period, a figure that remained flat on a reported basis but dropped 2 per cent when currency fluctuations were stripped out.
Global performance was dragged down by an 11 per cent sales dive in its Greater China market. Sales across Europe, the Middle East and Africa rose 3 per cent on a reported basis, though they fell 3 per cent on a currency-neutral basis. North America posted a 5 per cent growth, while the Asia Pacific and Latin America regions saw combined sales hold flat on a reported basis and down 1 per cent on a currency-neutral basis.
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Inventory builds and cash drains
Nike Australia’s sales growth came with a significant build-up of stock. Net inventories rose 32 per cent to $178 million at May 31, up from $134.4 million a year earlier. Finished goods on hand, before provisions, climbed from $140.7 million to $197.1 million.
The company recognised $17.4 million in expenses for inventory carried at net realisable value, up from $2.3 million in FY25. The write-down was booked in cost of sales, and its provision for inventory obsolescence nearly tripled to $19.3 million.
This inventory growth weighed on Nike Australia’s cash position. The company recorded a net operating cash outflow of $29.7 million in FY26, reversing an inflow of $21.2 million the previous year. Its inventory increase drained $43.6 million, and a reduction in trade and other payables, employee benefits and provisions drained a further $24.7 million.
Cash and cash equivalents fell from $68.5 million to $22.8 million. Most of the drop came from money Nike Australia had placed on deposit with related party Nike Global Trading B.V.’s Singapore branch, which fell from $61.5 million to $2 million.
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Retail partners face pressure
The filing points to pressure on Nike’s local retail partners. Nike Australia recognised a $903,000 charge for expected credit losses on trade receivables, up from $407,000 in FY25. Receivables written off as uncollectible rose from $106,000 to $619,000.
According to the filing, the individually impaired receivables relate to retailers that are mainly experiencing economic difficulties. Trade receivables of $10.1 million were past due at May 31, up from $9.9 million a year earlier.
The filing does not name the retailers involved in these write-offs. Last year, Nike Australia took surfwear retailer SurfStitch to the Supreme Court of Victoria, claiming it was owed $237,760.38 and seeking to have the business wound up. SurfStitch then entered administration in June 2025 and was subsequently taken on and revived under new owners Best Markets.
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