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Item 2. Management’s Discussion and Analysis

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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 consumer experiences through digital platforms and at retail.

Through the Consumer Direct Acceleration we are focusing on creating the marketplace of the future through more premium, consistent and seamless consumer experiences, leading with NIKE Digital and our owned stores, as well as select strategic partners who share our marketplace vision.

We have aligned our product creation and category organizations around a new consumer construct focused on Men’s, Women's, Kids' and the Jordan Brand and continue to invest in data and analytics, demand sensing, insight gathering, inventory management and other areas to create an end-to-end technology foundation, which will further accelerate our digital transformation.

During fiscal 2021, we substantially completed a series of leadership and operating model changes to streamline and speed up strategic execution of the Consumer Direct Acceleration.

For the three and six months ended November 30, 2021 , we recognized an immaterial amount of related employee termination costs and, to a lesser extent, stock-based compensation expense .

During the three months ended November 30, 2020, we recognized employee termination costs of $107 million and $30 million within Operating overhead expense and Cost of sales, respectively, and made cash payments of $67 million.

For the six months ended November 30, 2020, we recognized employee termination costs of $145 million and $30 million within Operating overhead expense and Cost of sales, respectively, and made cash payments of $71 million.

Through the Consumer Direct Acceleration we are focusing on creating the marketplace of the future through more premium, consistent and seamless consumer experiences, leading with digital and our owned stores, as well as select wholesale partners that share our marketplace vision.

Over the last several years, as we have executed against the Consumer Direct Acceleration, we have grown our NIKE Direct business to be approximately 43% of total NIKE Brand revenues for the first nine months of fiscal 2022, and we have reduced the number of wholesale accounts globally.

Additionally, we have aligned our product creation and category organizations around a new consumer construct focused on Men’s, Women's, Kids' and the Jordan Brand and continue to invest in data and analytics, demand sensing, insight gathering, inventory management and other areas to create an end-to-end technology foundation, which we expect will further accelerate our digital transformation.

During fiscal 2021, we substantially com pleted a series of leadership and operating model changes to streamline and speed up the strategic execution of the Consumer Direct Acceleration.

For the three and nine months ended February 28, 2022 , we recognized an immaterial amount of related employee termination costs and, to a lesser extent, stock-based compensation expense.

During the three months ended February 28, 2021, we recognized employee termination costs of $23 million and $6 million within Operating overhead expense and Cost of sales, respectively, and made cash payments of $99 million.

For the nine months ended February 28, 2021, we recognized employee termination costs of $168 million and $36 million within Operating overhead expense and Cost of sales, respectively, and made cash payments of $170 million.

Additionally, the related stock-based compensation expense recorded within Operating overhead expense and Cost of sales was immaterial for the three months ended February 28, 2021, and was $40 million and $4 million, respectively, for the nine months ended February 28, 2021 .

For all periods presented these costs were classified within Corporate.

Additionally, the related stock-based compensation expense recorded within Operating overhead expense and Cost of sales was $30 million and $4 million, respectively, for the three months ended November 30, 2020, and $39 million and $4 million, respectively, for the six months ended November 30, 2 020.

For more information, see Note 14 — Restructuring within the accompanying Notes to the Unaudited Condensed Consolidated Financial Statements.

COVID-19 UPDATE

The COVID-19 pandemic continues to create volatility in our business results and operations globally, causing us to transform the way we operate in order to better serve our consumers.

Our second quarter and first six months of fiscal 2022 Revenues grew 1% and 8%, respectively, as we continued to manage the ongoing impacts of supply chain challenges across each of our geographies and Converse.

The COVID-19 pandemic and its impacts on the global supply chain continue to create volatility in our business results and operations globally, causing us to transform the way we operate in order to better serve our consumers.

Revenues grew 5% for the third quarter of fiscal 2022, as we continued to manage the ongoing impacts of supply chain challenges across each of our geographies and Converse.

Our NIKE Direct business continued its momentum, growing 15% and 17% on a reported and currency-neutral basis, respectively, for the third quarter of fiscal 2022, led by North America, APLA and EMEA, partially offset by declines in Greater China due to a COVID-19 resurgence and ongoing marketplace dynamics.

As of April 4, 2022, nearly all of our owned stores were open across North America, EMEA and APLA.

In Greater China however, due to a COVID-19 resurgence, we continue to experience a higher level of temporary store closures, with some operating on reduced hours, as well as lower physical traffic versus pre-pandemic periods.

During the first quarter of fiscal 2022, the majority of NIKE Brand and Converse contract manufacturers in Vietnam and Indonesia were subject to government mandated shutdowns due to COVID-19.

These closures have significantly impacted, and are expected to continue to significantly impact, our previously planned inventory production.

As a result of these closures, we have lost approximately three months of production, impacting available product supply for this fiscal year.

All impacted factories began re-opening in October and are currently operational.

We expect it will take several months from re-opening for the factories to return to pre-closure production volumes, and there could be further impacts, including additional closures or employee absences, as a result of the emergence and spread of COVID-19 variants, as well as other factors outside of our control that could continue to cause further disruption to our planned inventory production.

These closures significantly impacted our previously planned inventory production.

As a result of these closures, we lost approximately three months of production, impacting available product supply for this fiscal year.

All impacted factories began re-opening in the second quarter of fiscal 2022 and globally, nearly all of our supplier base is currently operational without restrictions.

While factory production is currently in line with pre-closure production levels and our future demand plans, there could be further impacts, including additional closures or employee absences, as a result of the emergence and spread of COVID-19 variants, as well as other factors outside of our control that could continue to cause further disruption to our planned inventory production.

For fiscal 2021, 51% of NIKE Brand footwear and 30% of NIKE Brand apparel was manufactured in Vietnam, and 24% of NIKE Brand footwear and less than 12% of NIKE Brand apparel was manufactured in Indonesia.

In addition, our product availability was also impacted by extended inventory transit times in the second quarter and first six months of fiscal 2022, due primarily to port congestion, transportation delays as well as labor and container shortages.

Our product availability was impacted most significantly in our wholesale channel.

We also experienced higher transportation, logistics and fulfillment costs as a result of this dynamic environment, which partially offset gross margin expansion in the second quarter and first six months of fiscal 2022.

The combined impact of factory closures and extended inventory transit times disproportionately impacted our geographies during the second quarter of fiscal 2022.

North America and EMEA, located further away from our sourcing base with longer transit times, entered the second quarter with elevated levels of inventory available to meet consumer demand as revenues grew 12% and 6% on a currency-neutral basis, respectively.

By contrast, Greater China and APLA, located closer to our sourcing base

with shorter transit times, entered the second quarter with a lower supply of available inventory, negatively impacting revenues during the second quarter of fiscal 2022 with revenues declining by 24% and 6% on a currency-neutral basis, respectively.

We expect the combination of factory closures and elevated transit times will continue to impact product availability, leading to inventory supply significantly lagging consumer demand for the remainder of the fiscal year.

In addition, we expect transportation, logistics and fulfillment costs will continue to increase as we navigate these supply chain constraints.

We also expect product costs to increase in the second half of fiscal 2022 due to higher input costs.

To mitigate the impact across our business, our teams are continuing to leverage our operational playbook and taking actions where we can, including shifting production capacity to other countries, strategic use of air freight and employing a seasonless approach to products.

In addition, our product availability continued to be impacted by extended inventory transit times in the third quarter and first nine months of fiscal 2022, due primarily to port congestion, transportation delays as well as labor and container shortages.

product availability was impacted most significantly in our wholesale channel.

We also experienced elevated transportation, logistics and fulfillment costs as a result of this dynamic environment, which partially offset gross margin expansion in the third quarter and first nine months of fiscal 2022.

We expect elevated transit times will continue to impact product availability, leading to inventory supply significantly lagging consumer demand for at least the remainder of the fiscal year.

In addition, we expect transportation, logistics and fulfillment costs will continue to remain elevated as we navigate these supply chain constraints.

We also expect product costs to remain elevated due to higher input costs.

Despite these short-term dynamics, our Consumer Direct Acceleration strategy continues to drive our business towards our long-term fiscal 2025 financial goals shared in our Annual Report on Form 10-K for the fiscal year ended May 31, 2021.

Our NIKE Direct business has continued its momentum in the second quarter, fueling our growth as we continue to navigate through the pandemic by leveraging our digital platforms with our store footprint to connect directly with our consumers.

Despite continued inventory constraints and supply chain challenges, NIKE Direct grew 8% and 16% on a currency-neutral basis, for the second quarter and first six months of fiscal 2022, respectively.

NIKE Brand Digital revenues grew 11% and 17% on a currency-neutral basis for the second quarter and first six months of fiscal 2022, respectively.

During the second quarter of fiscal 2022, we experienced an increase in comparable store sales in North America and EMEA, partially offset by declines in Greater China and APLA due to supply chain challenges as well as ongoing marketplace dynamics and a COVID-19 resurgence in Greater China.

As of January 3, 2022, approximately 98% of our owned stores were open with some operating on reduced hours.

During the quarter, we continued to invest in our digital transformation and brand campaigns as the world continues its return to sport.

During the quarter, we continued to invest in our digital transformation and brand campaigns as the world returns to sport.

For the remainder of fiscal 2022, we will maintain our multi-year investment plans in order to transform our business for the future.

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Such developments and other potential impacts of COVID-19, such as new or prolonged factory closures, higher inventory levels or inventory shortages in various markets, other adverse impacts on the global supply chain, revised payment terms with certain of our wholesale customers, higher sales-related reserves, factory cancellation costs and a volatile effective tax rate driven by changes in the mix of earnings across our jurisdictions, among other factors, could have material adverse impacts on our revenue growth as well as our overall profitability in future periods.

As a result of these circumstances, COVID-19 related disruptions are making it more challenging to compare our performance, including our revenue growth and overall profitability, across quarters and fiscal years, and we expect the operating environment will remain volatile as COVID-19 variants continue to cause disruptions to our operations.

SECOND QUARTER OVERVIEW

For the second quarter of fiscal 2022, NIKE, Inc.

Revenues increased 1% to $11.4 billion compared to the second quarter of fiscal 2021 and were flat on a currency-neutral basis.

Net income was $1,337 million and diluted earnings per common share was $0.83 for the second quarter of fiscal 2022, compared to Net income of $1,251 million and diluted earnings per common share of $0.78 for the second quarter of fiscal 2021.

Income before income taxes increased 3% compared to the second quarter of fiscal 2021, due to gross margin expansion and higher revenues, partially offset by higher selling and administrative expense.

The NIKE Brand, which represents over 90% of NIKE, Inc.

Revenues, increased 1% compared to the second quarter of fiscal 2021.

On a currency-neutral basis, NIKE Brand revenues were flat, as higher revenues in North America and EMEA were offset by declines in Greater China and APLA.

Additionally, NIKE Brand currency-neutral revenue growth in apparel was offset by a decline in footwear primarily due to lower available inventory supply resulting from COVID-19 related factory closures and extended inventory transit times.

Revenues for Converse increased 17% and 16% compared to the second quarter of fiscal 2021, on a reported and currency-neutral basis, respectively, led by performance in Direct to consumer in both Western Europe and North America.

Our effective tax rate was 10.9% for the second quarter of fiscal 2022, compared to 14.1% for the second quarter of fiscal 2021, primarily due to a change in our earnings mix, partially offset by a less favorable impact from stock-based compensation.

As a result of these circumstances, COVID-19 related disruptions are making it more challenging to compare our performance, including our revenue growth and overall profitability, across quarters and fiscal years, and we expect that the operating environment could remain volatile as COVID-19 variants may continue to cause disruptions to our operations.

THIRD QUARTER OVERVIEW

For the third quarter of fiscal 2022, NIKE, Inc.

Revenues increased 5% to $10.9 billion compared to the third quarter of fiscal 2021 and increased 8% on a currency-neutral basis.

Net income was $1,396 million and diluted earnings per common share was $0.87 for the third quarter of fiscal 2022, compared to Net income of $1,449 million and diluted earnings per common share of $0.90 for the third quarter of fiscal 2021.

Income before income taxes increased 2% compared to the third quarter of fiscal 2021, due to higher Revenues and gross margin expansion, partially offset by higher Selling and administrative expense.

NIKE Brand revenues, which represent over 90% of NIKE, Inc.

Revenues, increased 6% compared to the third quarter of fiscal 2021.

On a currency-neutral basis, NIKE Brand revenues increased 8%, driven by higher revenues in EMEA, North America and APLA, partially offset by declines in Greater China.

Additionally, NIKE Brand currency-neutral revenues were higher across apparel and footwear, as well as Men's, the Jordan Brand, Kids' and Women's.

Revenues for Converse decreased 1% and increased 2% compared to the third quarter of fiscal 2021, on a reported and currency-neutral basis, respectively, led by strong performance in North America and Western Europe, partially offset by declines in Asia.

Our effective tax rate was 16.4% for the third quarter of fiscal 2022, compared to 11.4% for the third quarter of fiscal 2021, due to a shift in our earnings mix, the effects of stock-based compensation and recently finalized U.S.

tax regulations.

Consumer protection and data privacy laws have been coming into effect across the world, including recently introduced laws that became effective during the second quarter of fiscal 2022 in China, that provide for the comprehensive regulation of data and personal data processing activities across all industries and operations such as collecting, utilizing, processing, sharing and transferring data and personal information in and out of China.

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RESULTS OF OPERATIONS

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(Dollars in millions, except per share data) 2022 2021 % CHANGE 2022 2021 % CHANGE

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CONSOLIDATED OPERATING RESULTS

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(Dollars in millions)

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See "Use of Non-GAAP Financial Measures" for further information.

(2) Global Brand Divisions revenues are primarily attributable to NIKE Brand licensing businesses that are not part of a geographic operating segment.

(2) Global Brand Divisions revenues include NIKE Brand licensing and other miscellaneous revenues that are not part of a geographic operating segment.

(3) Corporate revenues primarily consist of foreign currency hedge gains and losses related to revenues generated by entities within the NIKE Brand geographic operating segments and Converse, but managed through our central foreign exchange risk management program.

SECOND QUARTER OF FISCAL 2022 COMPARED TO SECOND QUARTER OF FISCAL 2021

THIRD QUARTER OF FISCAL 2022 COMPARED TO THIRD QUARTER OF FISCAL 2021

On a currency-neutral basis, NIKE, Inc.

Revenues were flat for the second quarter of fiscal 2022, as higher revenues in North America, EMEA and Converse were offset by lower revenues in Greater China and APLA.

Higher revenues in North America, EMEA and Converse contributed approximately 4, 1 and 1 percentage points to NIKE, Inc.

Revenues, respectively, while lower revenues in Greater China and APLA reduced NIKE, Inc.

Revenues by approximately 5 and 1 percentage points, respectively.

On a currency-neutral basis, NIKE Brand footwear revenues decreased 1% in the second quarter of fiscal 2022, driven primarily by lower revenues in Men's.

Unit sales of footwear decreased 7%, while higher average selling price (ASP) per pair contributed approximately 6 percentage points of footwear revenue growth, primarily due to higher NIKE Direct ASP, as well as a higher mix of full-price sales, partially offset by lower full-price ASP, on a wholesale equivalent basis.

Currency-neutral NIKE Brand apparel revenues, for the second quarter of fiscal 2022, increased 1%, driven primarily by growth in NIKE Direct, partially offset by declines in our wholesale business.

Unit sales of apparel decreased 6%, and higher ASP per unit contributed approximately 7 percentage points of apparel revenue growth.

Higher ASP per unit was primarily due to higher NIKE Direct ASP, a higher mix of full-price sales and higher full-price ASP, primarily due to lower discounts, as well as higher off-price ASP.

On a reported basis, NIKE Direct revenues represented approximately 43% of our total NIKE Brand revenues for the second quarter of fiscal 2022 compared to 40% for the second quarter of fiscal 2021.

Digital commerce sales were $2.7 billion for the second quarter of fiscal 2022 compared to $2.4 billion for the second quarter of fiscal 2021.

On a currency-neutral basis, NIKE Direct revenues increased 8%, driven by digital commerce sales growth of 11%, comparable store sales growth of 3%, in part due to improved physical retail traffic in some of our geographies, and the addition of new stores.

Revenues increased 8% for the third quarter of fiscal 2022, driven by growth in EMEA, North America and APLA, partially offset by lower revenues in Greater China.

Higher revenues in EMEA, North America and APLA contributed approximately 4, 3 and 3 percentage points to NIKE, Inc.

Revenues, respectively, while lower revenues in Greater China reduced NIKE, Inc.

Revenues by approximately 2 percentage points.

On a currency-neutral basis, NIKE Brand footwear revenues increased 5% in the third quarter of fiscal 2022, driven by growth in NIKE Direct, partially offset by a decline in our wholesale business.

Unit sales of footwear decreased 3%, while higher average selling price (ASP) per pair contributed approximately 8 percentage points of footwear revenue growth, primarily due to higher NIKE Direct ASP, the favorable impact of growth in our NIKE Direct business, higher full-price ASP, net of discounts, on a wholesale equivalent basis, and a higher mix of full-price sales.

Currency-neutral NIKE Brand apparel revenues, for the third quarter of fiscal 2022, increased 12%, driven primarily by growth in Men's.

Unit sales of apparel increased 5%, and higher ASP per unit contributed approximately 7 percentage points of apparel revenue growth, primarily due to higher full-price and NIKE Direct ASPs.

On a reported basis, NIKE Direct revenues represented approximately 44% of our total NIKE Brand revenues for the third quarter of fiscal 2022 compared to 40% for the third quarter of fiscal 2021.

Digital commerce sales were $2.7 billion for the third quarter of fiscal 2022 compared to $2.2 billion for the third quarter of fiscal 2021.

On a currency-neutral basis, NIKE Direct revenues increased 17%, driven by digital commerce sales growth of 22%, comparable store sales growth of 12%, in part due to improved physical retail traffic, and the addition of new stores.

Comparable store sales, which exclude digital commerce sales, comprises revenues from NIKE-owned in-line and factory stores for which all three of the following requirements have been met:

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Management considers this metric when making financial and operating decisions.

method of calculating comparable store sales varies across the retail industry.

The method of calculating comparable

store sales varies across the retail industry.

As a result, our calculation of this metric may not be comparable to similarly titled measures used by other companies.

FIRST SIX MONTHS OF FISCAL 2022 COMPARED TO FIRST SIX MONTHS OF FISCAL 2021

FIRST NINE MONTHS OF FISCAL 2022 COMPARED TO FIRST NINE MONTHS OF FISCAL 2021

On a currency-neutral basis, NIKE, Inc.

Revenues increased 6% for the first six months of fiscal 2022, driven by higher revenues in North America, EMEA, APLA and Converse, partially offset by lower revenues in Greater China.

Revenues increased 7% for the first nine months of fiscal 2022, driven by higher revenues in North America, EMEA, APLA and Converse, partially offset by lower revenues in Greater China.

Higher revenues in North America, EMEA, APLA and Converse contributed approximately 4, 2, 2 and 1 percentage points to NIKE, Inc.

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Revenues by approximately 2 percentage points.

On a currency-neutral basis, NIKE Brand footwear revenues increased 5%, driven primarily by growth in NIKE Direct.

Unit sales of footwear decreased 1%, while higher ASP per pair contributed approximately 6 percentage points of footwear revenue growth, primarily due to higher NIKE Direct ASP, as well as a higher mix of full-price sales, partially offset by lower full-price ASP.

Currency-neutral NIKE Brand apparel revenues increased 8%, driven by growth in Men's.

On a currency-neutral basis, NIKE Brand footwear revenues increased 5%, driven by growth in NIKE Direct, partially offset by a decline in our wholesale business.

Unit sales of footwear decreased 2%, while higher ASP per pair contributed approximately 7 percentage points of footwear revenue growth, primarily due to higher NIKE Direct ASP, a higher mix of full-price sales and the favorable impact of growth in our NIKE Direct business.

Currency-neutral NIKE Brand apparel revenues increased 9%, driven primarily by growth in Men's.

Unit sales of apparel increased 2%, and higher ASP per unit contributed approximately 7 percentage points of apparel revenue growth.

Higher ASP per unit was primarily due to higher NIKE Direct and full-price ASPs, as well as a higher mix of full-price sales.

On a reported basis, NIKE Direct revenues represented approximately 42% of our total NIKE Brand revenues for the first six months of fiscal 2022 compared to 38% for the first six months of fiscal 2021.

Digital commerce sales were $5.2 billion for the first six months of fiscal 2022 compared to $4.4 billion for the first six months of fiscal 2021.

Higher ASP per unit was primarily due to higher full-price and NIKE Direct ASPs, as well as a higher mix of full-price sales.

On a reported basis, NIKE Direct revenues represented approximately 43% of our total NIKE Brand revenues for the first nine months of fiscal 2022 compared to 39% for the first nine months of fiscal 2021.

Digital commerce sales were $7.9 billion for the first nine months of fiscal 2022 compared to $6.6 billion for the first nine months of fiscal 2021.

On a currency-neutral basis, NIKE Direct revenues increased 16%, driven by digital commerce sales growth of 19%, comparable store sales growth of 12%, in part due to improved physical retail traffic, and the addition of new stores.

THREE MONTHS ENDED NOVEMBER 30, SIX MONTHS ENDED NOVEMBER 30,

THREE MONTHS ENDED FEBRUARY 28, NINE MONTHS ENDED FEBRUARY 28,

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Gross margin 46.6 % 45.6 % 100 bps 46.3 % 44.4 % 190 bps

For the second quarter of fiscal 2022, our consolidated gross margin was 280 basis points higher than the prior year period and primarily reflected the following factors:

• Higher margin in our NIKE Direct business, primarily driven by low promotional activity in the current period reflecting limited available for sale inventory due to supply chain constraints compared to higher promotional activity in the prior year as we managed the impacts from COVID-19 (increasing gross margin approximately 170 basis points);

• Higher mix of full-price sales, on a wholesale equivalent basis, (increasing gross margin approximately 110 basis points);

• Lower other costs, in part due to higher restructuring-related costs related to our organizational realignment in the prior year, among other factors, (increasing gross margin approximately 50 basis points);

For the third quarter of fiscal 2022, our consolidated gross margin was 100 basis points higher than the prior year period and primarily reflected the following factors:

• Higher margin in our NIKE Direct business, primarily driven by lower promotional activity in the current period reflecting limited available for sale inventory due to supply chain constraints compared to higher promotional activity in the prior year as we managed the impacts from COVID-19, (increasing gross margin approximately 140 basis points);

• Favorable changes in net foreign currency exchange rates, including hedges, (increasing gross margin approximately 80 basis points);

• Lower NIKE Brand full-price product margins, on a wholesale equivalent basis.

Specifically, higher product costs (decreasing gross margin approximately 60 basis points) largely due to increased freight and logistics costs as well as lower full-price ASP, net of discounts, (decreasing gross margin approximately 40 basis points) primarily due to a lower mix of Greater China sales.

For the first six months of fiscal 2022, our consolidated gross margin was 230 basis points higher than the prior year period and primarily reflected the following factors:

• Higher mix of full-price sales, on a wholesale equivalent basis, (increasing gross margin approximately 70 basis points);

• Lower other costs, in part due to higher restructuring-related costs related to our organizational realignment in the prior year, (increasing gross margin approximately 40 basis points);

• Lower NIKE Brand full-price product margins, on a wholesale equivalent basis, (decreasing gross margin approximately 170 basis points) reflecting:

• Higher product costs (decreasing gross margin approximately 120 basis points) largely due to increased freight and logistics costs as well as product mix;

• Lower full-price ASP, net of discounts, (decreasing gross margin approximately 50 basis points) driven by product mix, partially offset by strategic pricing increases;

• Higher other costs, in part due to higher warehousing and freight costs, among other factors (decreasing gross margin approximately 30 basis points).

For the first nine months of fiscal 2022, our consolidated gross margin was 190 basis points higher than the prior year period and primarily reflected the following factors:

• Higher margin in our NIKE Direct business, primarily driven by lower promotional activity in the current period reflecting limited available for sale inventory due to supply chain constraints compared to higher promotional activity in the prior year as we managed the impacts from COVID-19 (increasing gross margin approximately 160 basis points);

• Higher mix of full-price sales, on a wholesale equivalent basis, (increasing gross margin approximately 70 basis points);

• Favorable changes in net foreign currency exchange rates, including hedges, (increasing gross margin approximately 50 basis points);

• Higher NIKE Brand product costs, on a wholesale equivalent basis, primarily due to increased freight and logistics costs (decreasing gross margin approximately 90 basis points).

TOTAL SELLING AND ADMINISTRATIVE EXPENSE

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(1) Demand creation expense consists of advertising and promotion costs, including costs of endorsement contracts, complimentary products, television, digital and print advertising and media costs, brand events and retail brand presentation.

SECOND QUARTER OF FISCAL 2022 COMPARED TO SECOND QUARTER OF FISCAL 2021

Demand creation expense increased 40% for the second quarter of fiscal 2022 primarily due to higher advertising and marketing spend against brand campaigns as we experienced marketplace closures in the prior year due to COVID-19, as well as continued investments in digital marketing to support heightened digital demand.

Changes in foreign currency exchange rates increased Demand creation expense by approximately 1 percentage point.

THIRD QUARTER OF FISCAL 2022 COMPARED TO THIRD QUARTER OF FISCAL 2021

Demand creation expense increased 20% for the third quarter of fiscal 2022 primarily due to higher advertising and marketing spend reflecting normalization of spend against brand campaigns and continued investments in digital marketing to support heightened digital demand.

Changes in foreign currency exchange rates decreased Demand creation expense by approximately 2 percentage points.

Operating overhead expense increased 11% primarily due to higher strategic technology investments and an increase in wage-related expenses.

Changes in foreign currency exchange rates decreased Operating overhead expense by approximately 1 percentage point.

FIRST NINE MONTHS OF FISCAL 2022 COMPARED TO FIRST NINE MONTHS OF FISCAL 2021

Demand creation expense increased 32% for the first nine months of fiscal 2022 primarily due to higher advertising and marketing spend against brand campaigns as we experienced marketplace closures in the prior year due to COVID-19, as well as continued investments in digital marketing to support heightened digital demand.

Changes in foreign currency exchange rates had an insignificant impact on Demand creation expense.

Operating overhead expense increased 11% primarily due to higher strategic technology investments and an increase in wage-related expenses.

Changes in foreign currency exchange rates had an insignificant impact on Operating overhead expense.

FIRST SIX MONTHS OF FISCAL 2022 COMPARED TO FIRST SIX MONTHS OF FISCAL 2021

Demand creation expense increased 38% for the first six months of fiscal 2022 primarily due to higher advertising and marketing spend against brand campaigns as we experienced marketplace closures in the prior year due to COVID-19, as well as continued investments in digital marketing to support heightened digital demand.

Changes in foreign currency exchange rates increased Demand creation expense by approximately 2 percentage points.

Operating overhead expense increased 12% primarily due to an increase in wage-related expenses and higher strategic technology investments.

Changes in foreign currency exchange rates increased Operating overhead expense by approximately 1 percentage point.

OTHER (INCOME) EXPENSE, NET

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Other (income) expense, net comprises foreign currency conversion gains and losses from the remeasurement of monetary assets and liabilities denominated in non-functional currencies and the impact of certain foreign currency derivative instruments, as well as unusual or non-operating transactions that are outside the normal course of business.

For the second quarter of fiscal 2022, Other (income) expense, net changed from $54 million of other expense to $102 million of other income in the current year, primarily due to a favorable change in foreign currency conversion gains and losses, including hedges, as well as incremental charges, in the prior year, related to our planned, strategic distributor partnership transition within APLA.

For the first six months of fiscal 2022, Other (income) expense, net changed from $40 million of other expense to $141 million of other income in the current year, primarily due to incremental charges, in the prior year, related to our planned, strategic distributor partnership transition within APLA, coupled with a net favorable change in foreign currency conversion gains and losses, including hedges.

For the third quarter of fiscal 2022, Other (income) expense, net increased from $22 million of other income to $94 million in the current year, primarily due to a favorable change in foreign currency conversion gains and losses, including hedges.

For the first nine months of fiscal 2022, Other (income) expense, net changed from $18 million of other expense to $235 million of other income in the current year, primarily due to a favorable change in foreign currency conversion gains and losses, including hedges, as well as a net incremental charge in the prior year, related to our planned, strategic distributor partnership transition within APLA.

For more information related to our distributor partnership transition within APLA, see Note 13 — Acquisitions and Divestitures within the accompanying Notes to the Unaudited Condensed Consolidated Financial Statements.

We estimate the combination of the translation of foreign currency-denominated profits from our international businesses and the year-over-year change in foreign currency-related gains and losses included in Other (income) expense, net had favorable impacts of approximately $63 million and $167 million on our Income before income taxes for the second quarter and first six months of fiscal 2022, respectively.

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We estimate the combination of the translation of foreign currency-denominated profits from our international businesses and the year-over-year change in foreign currency-related gains and losses included in Other (income) expense, net had favorable impacts of approximately $3 million and $170 million on our Income before income taxes for the third quarter and first nine months of fiscal 2022, respectively.

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2022 2021 % CHANGE 2022 2021 % CHANGE

Effective tax rate 16.4 % 11.4 % 500 bps 12.7 % 12.3 % 40 bps

Our effective tax rate was 11.0% for the first six months of fiscal 2022, compared to 12.7% for the first six months of fiscal 2021, primarily due to a more favorable impact from stock-based compensation and discrete items, such as the recognition of a reserve in the first quarter of fiscal 2021 related to Altera Corp.

Commissioner , partially offset by a change in our earnings mix.

Our effective tax rate was 16.4% for the third quarter of fiscal 2022, compared to 11.4% for the third quarter of fiscal 2021, primarily due to the impact of recently finalized U.S.

tax regulations and a less favorable impact from stock-based compensation, partially offset by a shift in our earnings mix.

Our effective tax rate was 12.7% for the first nine months of fiscal 2022, compared to 12.3% for the first nine months of fiscal 2021, primarily due to the impact of recently finalized U.S.

tax regulations, partially offset by changes in discrete items compared to the first nine months of fiscal 2021, including the recognition of a reserve in the first quarter of fiscal 2021 related to Altera Corp.

Commissioner.

Refer to Note 6 — Income Taxes within the accompanying Notes to the Unaudited Condensed Consolidated Financial Statements for additional information.

17 unchanged sentences

The breakdown of Revenues is as follows:

THREE MONTHS ENDED NOVEMBER 30, SIX MONTHS ENDED NOVEMBER 30,

THREE MONTHS ENDED FEBRUARY 28, NINE MONTHS ENDED FEBRUARY 28,

(Dollars in millions)

20 unchanged sentences

The breakdown of earnings before interest and taxes is as follows:

THREE MONTHS ENDED NOVEMBER 30, SIX MONTHS ENDED NOVEMBER 30,

THREE MONTHS ENDED FEBRUARY 28, NINE MONTHS ENDED FEBRUARY 28,

(Dollars in millions)

21 unchanged sentences

NORTH AMERICA

THREE MONTHS ENDED NOVEMBER 30, SIX MONTHS ENDED NOVEMBER 30,

THREE MONTHS ENDED FEBRUARY 28, NINE MONTHS ENDED FEBRUARY 28,

(Dollars in millions) 2022 2021 % CHANGE % CHANGE EXCLUDING CURRENCY CHANGES 2022 2021 % CHANGE % CHANGE EXCLUDING CURRENCY CHANGES

7 unchanged sentences

EARNINGS BEFORE INTEREST AND TAXES $ 967 $ 970 0 % $ 3,636 $ 3,295 10 %

We believe there continues to be a meaningful shift in the way consumers shop for product and make purchasing decisions across each of our geographies.

Consumers are demanding a constant flow of fresh and innovative product, and have an expectation for superior service and rapid delivery, all fueled by the shift toward digital and mono-brand experiences in NIKE Direct.

We anticipate continued evolution within the retail landscape, driven by shifting consumer traffic patterns across digital and physical channels.

Specifically in North America, we remain focused on building long-term momentum with our strategic wholesale customers, which offer a differentiated retail experience.

Additionally, over the last three years we have significantly reduced the number of undifferentiated wholesale accounts.

During fiscal 2021 and the first six months of fiscal 2022, we took further steps towards account and channel consolidation by reprioritizing product allocation to benefit NIKE Direct and our differentiated strategic wholesale customers.

We expect we will continue to aggressively accelerate these changes over the next several fiscal years as we work to reprofile the shape of the marketplace and recapture wholesale revenue declines over time.

SECOND QUARTER OF FISCAL 2022 COMPARED TO SECOND QUARTER OF FISCAL 2021

On a currency-neutral basis, North America revenues for the second quarter of fiscal 2022 increased 12%, due primarily to higher revenues in Women's and the Jordan Brand, partially offset by a decline in Men's.

THIRD QUARTER OF FISCAL 2022 COMPARED TO THIRD QUARTER OF FISCAL 2021

On a currency-neutral basis, North America revenues for the third quarter of fiscal 2022 increased 9%, due primarily to higher revenues in Men's.

NIKE Direct revenues increased 27%, driven by strong digital sales growth of 33%, comparable store sales growth of 16%, in part due to improved physical retail traffic, and the addition of new stores.

Footwear revenues increased 13% on a currency-neutral basis, largely driven by higher revenues in Women's, partially offset by a decline in Men's.

Unit sales of footwear increased 7%, while higher ASP per pair contributed approximately 6 percentage points of footwear revenue growth.

Higher ASP per pair was primarily due to higher NIKE Direct ASP, the favorable impact of growth in our NIKE Direct business and a higher mix of full-price sales, partially offset by lower full-price ASP.

On a currency-neutral basis, apparel revenues increased 8%, driven primarily by growth in NIKE Direct.

Footwear revenues increased 6% on a currency-neutral basis, driven by growth in NIKE Direct, partially offset by declines in our wholesale business.

Unit sales of footwear decreased 10%, reflecting a lack of available inventory supply due to the impact of factory closures during the first quarter of fiscal 2022 as well as elevated inventory transit times, while higher ASP per pair contributed approximately 16 percentage points of footwear revenue growth.

Higher ASP per pair was primarily due to higher NIKE Direct ASP, the favorable impact of growth in our NIKE Direct business, higher full-price ASP and a higher mix of full-price sales.

On a currency-neutral basis, apparel revenues increased 11%, driven primarily by growth in Men's, partially offset by a decline in Women's.

Unit sales of apparel decreased 6%, while higher ASP per unit contributed approximately 17 percentage points of apparel revenue growth.

The increase in ASP per unit was primarily driven by higher NIKE Direct ASP, as well as higher full-price ASP, primarily due to lower discounts, and a higher mix of full-price sales.

Reported EBIT increased 21% as higher revenues and gross margin expansion more than offset higher selling and administrative expense.

Gross margin increased approximately 280 basis points primarily due to higher margins and the favorable impact of growth in our NIKE Direct business, as well as a higher mix of full-price sales and higher full-price ASP, net of discounts.

This activity was partially offset by higher product costs primarily due to increased freight and logistics costs.

Selling and administrative expense increased due to higher demand creation and operating overhead expense.

Demand creation expense increased primarily as a result of higher advertising and marketing expense as well as digital marketing investments, partially offset by lower sports marketing costs.

The increase in operating overhead expense reflected higher wage-related costs as well as an increase in strategic technology investments.

FIRST SIX MONTHS OF FISCAL 2022 COMPARED TO FIRST SIX MONTHS OF FISCAL 2021

On a currency-neutral basis, North America revenues for the first six months of fiscal 2022 increased 13%, due primarily to higher revenues in Women's.

The increase in ASP per unit was primarily driven by higher full-price and NIKE Direct ASPs and the favorable impact of growth in our NIKE Direct business.

Reported EBIT was flat as higher revenues were offset by higher selling and administrative expense and gross margin contraction.

Gross margin decreased approximately 50 basis points largely driven by higher product costs primarily due to increased freight and logistics costs.

This activity was partially offset by higher margins in our NIKE Direct business and the favorable impact of growth in our NIKE Direct business as well as higher full-price ASP, net of discounts, and a higher mix of full-price sales.

Selling and administrative expense increased due to higher operating overhead and demand creation expense.

Operating overhead expense increased primarily as a result of higher wage-related costs, lower bad debt recoveries and higher strategic technology investments.

The increase in demand creation expense reflected higher advertising and marketing expense as well as continued investments in digital marketing to support heightened digital demand.

FIRST NINE MONTHS OF FISCAL 2022 COMPARED TO FIRST NINE MONTHS OF FISCAL 2021

On a currency-neutral basis, North America revenues for the first nine months of fiscal 2022 increased 12%, due primarily to higher revenues in Women's.

NIKE Direct revenues increased 34%, driven by strong digital sales growth of 39%, comparable store sales growth of 26%, in part due to improved physical retail traffic, and the addition of new stores.

Footwear revenues increased 12% on a currency-neutral basis, largely driven by higher revenues in Women's and the Jordan Brand, partially offset by a decline in Men's.

Footwear revenues increased 10% on a currency-neutral basis, largely driven by higher revenues in Women's and Kids', partially offset by a decline in Men's.

Unit sales of footwear increased 1%, while higher ASP per pair contributed approximately 9 percentage points of footwear revenue growth.

Higher ASP per pair was primarily due to higher NIKE Direct ASP, the favorable impact of growth in our NIKE Direct business and a higher mix of full-prices sales, partially offset by lower full-price ASP.

On a currency-neutral basis, apparel revenues increased 15%, driven primarily by higher revenues in Men's.

Unit sales of apparel increased 1%, while higher ASP per unit contributed approximately 14 percentage points of apparel revenue growth.

The increase in ASP per unit was primarily driven by higher NIKE Direct ASP, the favorable impact of growth in our NIKE Direct business and higher full-price ASP, as well as a higher mix of full-price sales.

The increase in ASP per unit was primarily driven by higher full-price and NIKE Direct ASPs, the favorable impact of growth in our NIKE Direct business as well as a higher mix of full-price sales.

Reported EBIT increased 10% as higher revenues and gross margin expansion more than offset higher selling and administrative expense.

Gross margin increased approximately 170 basis points primarily due to higher margins and the favorable impact of growth in our NIKE Direct business, as well as a higher mix of full-price sales.

Gross margin increased approximately 100 basis points primarily due to higher margins and the favorable impact of growth in our NIKE Direct business, a higher mix of full-price sales and higher full-price ASP, net of discounts.

This activity was partially offset by higher product costs primarily due to increased freight and logistics costs.

3 unchanged sentences

EUROPE, MIDDLE EAST & AFRICA

THREE MONTHS ENDED NOVEMBER 30, SIX MONTHS ENDED NOVEMBER 30,

THREE MONTHS ENDED FEBRUARY 28, NINE MONTHS ENDED FEBRUARY 28,

(Dollars in millions) 2022 2021 % CHANGE % CHANGE EXCLUDING CURRENCY CHANGES 2022 2021 % CHANGE % CHANGE EXCLUDING CURRENCY CHANGES

7 unchanged sentences

EARNINGS BEFORE INTEREST AND TAXES $ 713 $ 533 34 % $ 2,394 $ 1,885 27 %

SECOND QUARTER OF FISCAL 2022 COMPARED TO SECOND QUARTER OF FISCAL 2021

On a currency-neutral basis, EMEA revenues for the second quarter of fiscal 2022 increased 6%, driven by growth in our wholesale business and NIKE Direct.

NIKE Direct revenues increased 6% primarily due to comparable store sales growth of 14%, in part due to improved physical retail traffic, and the addition of new stores, partially offset by a decline in digital sales of 1%.

Currency-neutral footwear revenues increased 4%, driven by growth in wholesale and NIKE Direct.

THIRD QUARTER OF FISCAL 2022 COMPARED TO THIRD QUARTER OF FISCAL 2021

On a currency-neutral basis, EMEA revenues for the third quarter of fiscal 2022 increased 13%, primarily driven by growth in Men's.

NIKE Direct revenues increased 22% primarily due to comparable store sales growth of 46%, in part due to improved physical retail traffic, digital sales growth of 11% and the addition of new stores.

Currency-neutral footwear revenues increased 4%, driven by growth in NIKE Direct, partially offset by declines in our wholesale business.

Unit sales of footwear decreased 6%, while higher ASP per pair contributed approximately 10 percentage points of footwear revenue growth.

Higher ASP per pair was primarily due to higher NIKE Direct and full-price ASPs, as well as a higher mix of full-price sales.

Higher ASP per pair was primarily due to higher full-price and NIKE Direct ASPs as well as a higher mix of full-price sales.

Currency-neutral apparel revenues increased 28% due primarily to higher revenues in Men's.

Unit sales of apparel increased 3%, while higher ASP per unit contributed approximately 5 percentage points of apparel revenue growth, primarily due to higher NIKE Direct ASP, a higher mix of full-price sales and higher full-price ASP.

Reported EBIT increased 22% as gross margin expansion and higher revenues more than offset higher selling and administrative expense.

Gross margin increased approximately 670 basis points primarily due to higher NIKE Direct margins, favorable changes in standard foreign currency exchange rates, a higher mix of full-price sales and lower other costs.

Selling and administrative expense increased due to higher demand creation and operating overhead expense.

Higher demand creation expense was driven by higher advertising and marketing expenses as well as higher sports marketing costs.

Higher operating overhead expense was primarily due to higher wage-related expenses.

FIRST SIX MONTHS OF FISCAL 2022 COMPARED TO FIRST SIX MONTHS OF FISCAL 2021

On a currency-neutral basis, EMEA revenues for the first six months of fiscal 2022 increased 7%, due primarily to higher revenues in Men’s.

NIKE Direct revenues increased 8% primarily due to comparable store sales growth of 15%, in part due to improved physical retail traffic, and the addition of new stores, while digital sales was relatively flat compared to prior year.

Unit sales of apparel increased 19%, while higher ASP per unit contributed approximately 9 percentage points of apparel revenue growth, primarily due to higher full-price and NIKE Direct ASPs as well as a higher mix of full-price sales.

Reported EBIT increased 34% as higher revenues and gross margin expansion more than offset higher selling and administrative expense.

Gross margin increased approximately 590 basis points primarily due to favorable changes in standard foreign currency exchange rates, higher NIKE Direct margins and a higher mix of full-price sales.

Selling and administrative expense increased due to higher operating overhead and demand creation expense.

Higher operating overhead expense was driven by higher strategic technology investments.

Higher demand creation expense was primarily due to higher advertising and marketing expense.

FIRST NINE MONTHS OF FISCAL 2022 COMPARED TO FIRST NINE MONTHS OF FISCAL 2021

On a currency-neutral basis, EMEA revenues for the first nine months of fiscal 2022 increased 9%, due primarily to higher revenues in Men’s.

NIKE Direct revenues increased 12% primarily due to comparable store sales growth of 22%, in part due to improved physical retail traffic, digital sales growth of 4% and the addition of new stores.

Currency-neutral footwear revenues increased 4%, driven by growth in NIKE Direct and our wholesale business.

2 unchanged sentences

Currency-neutral apparel revenues increased 16% due primarily to higher revenues in Men's.

Unit sales of apparel increased 5%, while higher ASP per unit contributed approximately 6 percentage points of apparel revenue growth, primarily due to higher full-price and NIKE Direct ASPs, as well as a higher mix of full-price sales.

Unit sales of apparel increased 8%, while higher ASP per unit contributed approximately 8 percentage points of apparel revenue growth, primarily due to higher NIKE Direct and full-price ASPs as well as a higher mix of full-price sales.

Reported EBIT increased 27% as higher revenues and gross margin expansion more than offset higher selling and administrative expense.

Gross margin increased approximately 460 basis points primarily due to higher NIKE Direct margins, favorable changes in standard foreign currency exchange rates and a higher mix of full-price sales, partially offset by higher product costs primarily due to increased freight and logistics costs.

Gross margin increased approximately 500 basis points primarily due to higher NIKE Direct margins, favorable changes in standard foreign currency exchange rates and a higher mix of full-price sales, partially offset by higher product costs largely due to increased freight and logistics costs.

Selling and administrative expense increased due to higher demand creation and operating overhead expense.

Higher demand creation expense was driven by higher advertising and marketing expenses.

Higher operating overhead expense was primarily due to higher wage-related expenses.

Higher demand creation expense was driven by higher advertising and marketing expense.

Higher operating overhead expense was primarily due to higher wage-related expenses and higher strategic technology investments.

GREATER CHINA

THREE MONTHS ENDED NOVEMBER 30, SIX MONTHS ENDED NOVEMBER 30,

THREE MONTHS ENDED FEBRUARY 28, NINE MONTHS ENDED FEBRUARY 28,

(Dollars in millions) 2022 2021 % CHANGE % CHANGE EXCLUDING CURRENCY CHANGES 2022 2021 % CHANGE % CHANGE EXCLUDING CURRENCY CHANGES

7 unchanged sentences

EARNINGS BEFORE INTEREST AND TAXES $ 784 $ 973 -19 % $ 2,054 $ 2,552 -20 %

SECOND QUARTER OF FISCAL 2022 COMPARED TO SECOND QUARTER OF FISCAL 2021

On a currency-neutral basis, Greater China revenues for the second quarter of fiscal 2022 decreased 24%, reflecting impacts from lack of available inventory supply and product launch timing due to factory closures and mandated store closures due to COVID-19, as well as ongoing marketplace dynamics.

THIRD QUARTER OF FISCAL 2022 COMPARED TO THIRD QUARTER OF FISCAL 2021

On a currency-neutral basis, Greater China revenues for the third quarter of fiscal 2022 decreased 8%, reflecting impacts from supply chain constraints, government restrictions due to COVID-19 as well as ongoing marketplace dynamics.

The decrease in revenues was primarily due to lower revenues in Men’s.

NIKE Direct revenues decreased 11% due to digital sales declines of 19%, comparable store sales declines of 10%, in part due to reduced physical retail traffic as a result of government restrictions due to COVID-19 as well as ongoing marketplace dynamics, partially offset by the addition of new stores.

Currency-neutral footwear revenues decreased 6%, driven primarily by lower revenues in Men's and Women's, partially offset by growth in the Jordan Brand.

Unit sales of footwear increased 2%, while lower ASP per pair reduced footwear revenues by approximately 8 percentage points, driven by lower NIKE Direct and full-price ASPs.

Currency-neutral apparel revenues decreased 13%, due primarily to lower revenues in Men's.

Unit sales of apparel decreased 3%, while lower ASP per unit reduced apparel revenues by approximately 10 percentage points, primarily due to lower NIKE Direct and full-price ASPs.

Reported EBIT decreased 19% due to lower revenues, higher selling and administrative expense and gross margin contraction.

Gross margin decreased approximately 140 basis points reflecting lower full-price ASP, net of discounts, and lower NIKE Direct margins, partially offset by favorable changes in standard foreign currency exchange rates and lower product costs due to favorable product mix.

Selling and administrative expense increased due to higher demand creation and operating overhead expense.

Growth in demand creation expense was primarily due to higher advertising and marketing expense.

Operating overhead expense increased largely due to higher strategic technology investments and higher wage-related costs.

FIRST NINE MONTHS OF FISCAL 2022 COMPARED TO FIRST NINE MONTHS OF FISCAL 2021

On a currency-neutral basis, Greater China revenues for the first nine months of fiscal 2022 decreased 11%, reflecting impacts from supply chain constraints, government restrictions due to COVID-19 as well as ongoing marketplace dynamics.

The decrease in revenues was primarily due to lower revenues in Men’s and Women's.

NIKE Direct revenues decreased 21% due to digital sales declines of 27%, comparable store sales declines of 18%, in part due to reduced physical retail traffic and mandated store closures due to COVID-19, partially offset by the addition of new stores.

Currency-neutral footwear revenues decreased 25%, driven primarily by lower revenues in Men's.

NIKE Direct revenues decreased 13% due to digital sales declines of 19%, comparable store sales declines of 11%, in part due to reduced physical retail traffic as a result of government restrictions due to COVID-19 as well as ongoing marketplace dynamics, partially offset by the addition of new stores.

Currency-neutral footwear revenues decreased 9%, driven primarily by lower revenues in Men's and Women's.

Unit sales of footwear decreased 5%, while lower ASP per pair reduced footwear revenues by approximately 4 percentage points, driven by lower NIKE Direct and full-price ASPs.

Currency-neutral apparel revenues decreased 15%, due primarily to lower revenues in Men's and Women's.

Unit sales of apparel decreased 17%, while lower ASP per unit reduced apparel revenues by approximately 4 percentage points, primarily due to lower NIKE Direct ASP, as well as lower full-price ASPs, primarily due to higher discounts.

Reported EBIT decreased 36% due to lower revenues, gross margin contraction and higher selling and administrative expense.

Gross margin decreased approximately 310 basis points reflecting lower full-price ASP, net of discounts, lower NIKE Direct margins, higher other costs and a lower mix of full-price sales, partially offset by lower product costs.

Higher other costs were primarily due to higher inventory obsolescence and the unfavorable rate impact of fixed supply chain costs on a lower volume of shipments.

Selling and administrative expense increased due to higher demand creation and operating overhead expense.

Growth in demand creation expense was primarily due to higher advertising and marketing costs as well as higher digital marketing investments.

Operating overhead expense increased largely due to higher wage-related costs, partially offset by lower administrative costs.

FIRST SIX MONTHS OF FISCAL 2022 COMPARED TO FIRST SIX MONTHS OF FISCAL 2021

On a currency-neutral basis, Greater China revenues for the first six months of fiscal 2022 decreased 13%, reflecting impacts from lack of available inventory supply and product launch timing due to factory closures, mandated store closures due to COVID-19 and ongoing marketplace dynamics.

The decrease in revenues was primarily due to lower revenues in the Men’s and Women's.

NIKE Direct revenues decreased 13% due to digital sales declines of 19%, comparable store sales declines of 12%, in part due to reduced physical retail traffic, partially offset by the addition of new stores.

Currency-neutral footwear revenues decreased 11%, driven primarily by lower revenues in Men's.

Unit sales of footwear decreased 8%, while lower ASP per pair reduced footwear revenues by approximately 3 percentage points, driven by lower NIKE Direct and full-price ASPs, primarily due to higher discounts.

Currency-neutral apparel revenues decreased 16%, due primarily to lower revenues in Women's.

Unit sales of apparel decreased 10%, while lower ASP per unit reduced apparel revenues by approximately 6 percentage points, primarily due to lower NIKE Direct and full-price ASPs, primarily due to higher discounts.

Reported EBIT decreased 20% due to lower revenues, gross margin contraction and higher selling and administrative expense.

Gross margin decreased approximately 220 basis points reflecting lower full-price ASP, primarily due to higher discounts, higher other costs and lower NIKE Direct margins, partially offset by lower product costs.

Higher other costs was primarily due to higher inventory obsolescence.

Unit sales of apparel decreased 8%, while lower ASP per unit reduced apparel revenues by approximately 7 percentage points, primarily due to lower NIKE Direct and full-price ASPs, reflecting higher discounts.

Reported EBIT decreased 20% due to lower revenues, higher selling and administrative expense and gross margin contraction.

Gross margin decreased approximately 190 basis points reflecting lower full-price ASP, net of discounts, lower NIKE Direct margins and higher other costs, primarily due to higher warehousing and freight.

This activity was partially offset by favorable changes in standard foreign currency exchange rates and lower product costs due to favorable product mix.

Selling and administrative expense increased due to higher demand creation and operating overhead expense.

Growth in demand creation expense was primarily due to higher advertising and marketing costs as well as digital marketing investments.

Operating overhead expense increased largely due to higher wage-related costs.

Growth in demand creation expense was primarily due to higher advertising and marketing expense.

Operating overhead expense increased largely due to higher wage-related costs and higher strategic technology investments.

ASIA PACIFIC & LATIN AMERICA

THREE MONTHS ENDED NOVEMBER 30, SIX MONTHS ENDED NOVEMBER 30,

THREE MONTHS ENDED FEBRUARY 28, NINE MONTHS ENDED FEBRUARY 28,

(Dollars in millions) 2022 2021 % CHANGE % CHANGE EXCLUDING CURRENCY CHANGES 2022 2021 % CHANGE % CHANGE EXCLUDING CURRENCY CHANGES

10 unchanged sentences

For more information see Note 13 — Acquisitions and Divestitures within the accompanying Notes to the Unaudited Condensed Consolidated Financial Statements.

SECOND QUARTER OF FISCAL 2022 COMPARED TO SECOND QUARTER OF FISCAL 2021

On a currency-neutral basis, APLA revenues decreased 6% for the second quarter of fiscal 2022.

The decline was due to lower revenues across nearly all territories, led by a decline of 67% due to our business model shift in Brazil to a distributor model in fiscal 2021, partially offset by higher revenues in SOCO (which comprises Argentina, Chile and Uruguay), which increased 33%.

Revenues decreased primarily due to lower revenues in Men’s.

NIKE Direct revenues increased 6%, primarily due to digital sales growth of 25%, partially offset by store closures and comparable store sales contraction of 1%, in part due to reduced physical retail traffic.

Currency-neutral footwear revenues decreased 8%, due primarily to lower revenues in Men's.

Unit sales of footwear decreased 25%, while higher ASP per pair contributed approximately 17 percentage points of footwear revenue growth.

Higher ASP per pair was driven by higher NIKE Direct, full-price and off-price ASPs, as well as a higher mix of full-price sales.

THIRD QUARTER OF FISCAL 2022 COMPARED TO THIRD QUARTER OF FISCAL 2021

On a currency-neutral basis, APLA revenues increased 19% for the third quarter of fiscal 2022.

The increase was due to higher revenues across nearly all territories, led by Korea, Mexico and SOCO (which comprises Argentina, Chile and Uruguay), which increased 23%, 51% and 43%, respectively.

Revenues increased primarily due to higher revenues in Women's and Men’s.

NIKE Direct revenues increased 39%, primarily due to digital sales growth of 61%, comparable store sales growth of 17%, in part due to improved physical retail traffic, and the addition of new stores.

Currency-neutral footwear revenues increased 20%, due primarily to higher revenues in Women's.

Unit sales of footwear increased 9%, while higher ASP per pair contributed approximately 11 percentage points of footwear revenue growth.

Higher ASP per pair was driven by higher NIKE Direct ASP and the favorable impact of growth in our NIKE Direct business, as well as higher full-price and off-price ASPs.

Higher ASPs, in part, reflect inflationary conditions in our SOCO territory.

Currency-neutral apparel revenues decreased 5%, due primarily to lower revenues in Men's and Women's.

Unit sales of apparel decreased 20%, while higher ASP per unit contributed approximately 15 percentage points of apparel revenue growth, driven by higher NIKE Direct, full-price and off-price ASPs, as well as a higher mix of full-price sales.

Currency-neutral apparel revenues increased 16%, due primarily to higher revenues in Men's.

Unit sales of apparel increased 15%, while higher ASP per unit contributed approximately 1 percentage point of apparel revenue growth, driven by higher off-price ASP and a higher mix of full-price sales, partially offset by lower full-price ASP.

Higher ASPs, in part, reflect inflationary conditions in our SOCO territory.

Reported EBIT decreased 8% for the second quarter of fiscal 2022, as lower revenues and higher selling and administrative expenses more than offset gross margin expansion.

Gross margin increased approximately 460 basis points primarily due to lower product costs, higher margins and the favorable impact of growth in our NIKE Direct business, higher full-price ASP, primarily reflecting lower discounts, and a higher mix of full-price sales.

Selling and administrative expense increased due to higher demand creation and operating overhead expense.

Higher demand creation expense was primarily due to higher digital marketing investments to support heightened digital demand.

The increase in operating overhead expense was primarily due to an increase in NIKE Direct strategic technology investments and lower bad debt recoveries.

FIRST SIX MONTHS OF FISCAL 2022 COMPARED TO FIRST SIX MONTHS OF FISCAL 2021

On a currency-neutral basis, APLA revenues increased 10% for the first six months of fiscal 2022.

Territory revenue growth was led by a 72% increase in SOCO, an 11% increase in Japan and a 23% increase in Mexico, partially offset by a decline of 56% due to our business model shift in Brazil to a distributor model in fiscal 2021.

Revenues increased primarily due to higher revenues in Men’s.

Reported EBIT increased 17% for the third quarter of fiscal 2022, as higher revenues and gross margin expansion more than offset higher selling and administrative expense.

Gross margin increased approximately 230 basis points primarily due to favorable changes in standard foreign currency exchange rates, higher margins and the favorable impact of growth in our NIKE Direct business, as well as lower product costs and a higher mix of full-price sales.

This activity was partially offset by lower full-price ASP, net of discounts.

Selling and administrative expense increased due to higher operating overhead and demand creation expense.

Higher operating overhead expense was primarily due to an increase in NIKE Direct strategic technology investments, as well as higher wage-related expenses.

The increase in demand creation expense was primarily due to higher digital marketing investments to support heightened digital demand.

FIRST NINE MONTHS OF FISCAL 2022 COMPARED TO FIRST NINE MONTHS OF FISCAL 2021

On a currency-neutral basis, APLA revenues increased 13% for the first nine months of fiscal 2022.

The increase was due to higher revenues across nearly all territories, driven by SOCO, Mexico and Korea, which increased 61%, 31% and 13%, respectively.

Revenues increased primarily due to higher revenues in Men’s and Women's.

NIKE Direct revenues increased 25%, primarily due to digital sales growth of 48% and comparable store sales growth of 10%, partially offset by store closures.

Currency-neutral footwear revenues increased 9%, due primarily to higher revenues in Kids' and the Jordan Brand, partially offset by declines in Men's.

Currency-neutral footwear revenues increased 13%, due primarily to higher revenues in Women's.

Unit sales of footwear decreased 1%, while higher ASP per pair contributed approximately 14 percentage points of footwear revenue growth.

Higher ASP per pair was driven by higher NIKE Direct ASP as well as higher full-price ASPs, primarily due to lower discounts, higher off-price ASP and a higher mix of full-price sales.

Higher ASP per pair was driven by higher NIKE Direct ASP, higher full-price ASP, reflecting lower discounts, higher off-price ASP and a higher mix of full-price sales.

Higher ASPs, in part, reflect inflationary conditions in our SOCO territory.

Currency-neutral apparel revenues increased 10%, due primarily to higher revenues in Men's.

Unit sales of apparel decreased 6%, while higher ASP per unit contributed approximately 14 percentage points of apparel revenue growth, driven by higher full-price ASP, reflecting lower discounts, higher NIKE Direct ASP, as well as higher off-price ASP and a higher mix of full-price sales.

Unit sales of apparel remained flat, while higher ASP per unit contributed approximately 10 percentage points of apparel revenue growth, driven by higher NIKE Direct, full-price and off-price ASPs, as well as a higher mix of full-price sales.

Higher ASPs, in part, reflect inflationary conditions in our SOCO territory.

Reported EBIT increased 23% for the first six months of fiscal 2022, as higher revenues and gross margin expansion more than offset higher selling and administrative expense.

Gross margin increased approximately 510 basis points primarily due to higher margins and the favorable impact of growth in our NIKE Direct business, lower other costs, higher full-price ASP, primarily due to lower discounts as well as lower product costs and a higher mix of full-price sales.

Reported EBIT increased 21% for the first nine months of fiscal 2022, as higher revenues and gross margin expansion more than offset higher selling and administrative expense.

Gross margin increased approximately 420 basis points primarily due to higher margins and the favorable impact of growth in our NIKE Direct business, lower product costs, lower other costs, a higher mix of full-price sales and higher full-price ASP due to lower discounts.

The decrease in other costs was primarily due to the favorable rate impact of fixed supply chain costs on a higher volume of wholesale shipments, as well as lower inventory obsolescence.

1 unchanged sentence

Higher demand creation expense was primarily due to higher digital marketing investments to support heightened digital demand.

The increase in operating overhead expense was primarily due to an increase in NIKE Direct strategic technology investments, and lower bad debt recoveries.

The increase in operating overhead expense was primarily due to an increase in NIKE Direct strategic technology investments, lower bad debt recoveries and higher wage-related expenses.

GLOBAL BRAND DIVISIONS

THREE MONTHS ENDED NOVEMBER 30, SIX MONTHS ENDED NOVEMBER 30,

THREE MONTHS ENDED FEBRUARY 28, NINE MONTHS ENDED FEBRUARY 28,

(Dollars in millions)

4 unchanged sentences

Global Brand Divisions revenues include NIKE Brand licensing and other miscellaneous revenues that are not part of a geographic operating segment.

SECOND QUARTER OF FISCAL 2022 COMPARED TO SECOND QUARTER OF FISCAL 2021

Global Brand Divisions' loss before interest and taxes increased 27% for the second quarter of fiscal 2022 driven by higher operating overhead and higher demand creation expense.

Higher operating overhead expense was primarily due to an increase in strategic technology investments and higher wage-related costs.

Higher demand creation expense was primarily due to higher sports marketing costs as well as higher advertising and marketing expense.

FIRST SIX MONTHS OF FISCAL 2022 COMPARED TO FIRST SIX MONTHS OF FISCAL 2021

Global Brand Divisions' loss before interest and taxes increased 21% for the first six months of fiscal 2022 driven by higher operating overhead and higher demand creation expense.

Higher operating overhead expense was primarily due to an increase in strategic technology investments and wage-related costs.

THIRD QUARTER OF FISCAL 2022 COMPARED TO THIRD QUARTER OF FISCAL 2021

Global Brand Divisions' loss before interest and taxes increased 14% for the third quarter of fiscal 2022 driven by higher operating overhead and higher demand creation expense.

Higher operating overhead expense was primarily due to an increase in strategic technology investments.

Higher demand creation expense was primarily due to higher advertising and marketing expense as well as higher digital marketing investments to support heightened digital demand.

FIRST NINE MONTHS OF FISCAL 2022 COMPARED TO FIRST NINE MONTHS OF FISCAL 2021

Global Brand Divisions' loss before interest and taxes increased 19% for the first nine months of fiscal 2022 driven by higher operating overhead and higher demand creation expense.

Higher operating overhead expense was primarily due to an increase in strategic technology investments as well as continued investment in digital capabilities.

Higher demand creation expense was primarily due to higher advertising and marketing expense.

THREE MONTHS ENDED NOVEMBER 30, SIX MONTHS ENDED NOVEMBER 30,

THREE MONTHS ENDED FEBRUARY 28, NINE MONTHS ENDED FEBRUARY 28,

(Dollars in millions)

12 unchanged sentences

We do not own the Converse trademarks in Japan and accordingly do not earn revenues in Japan.

SECOND QUARTER OF FISCAL 2022 COMPARED TO SECOND QUARTER OF FISCAL 2021

On a currency-neutral basis, Converse revenues increased 16% for the second quarter of fiscal 2022 driven by revenue growth in Western Europe and North America, partially offset by declines in Asia.

Wholesale revenues increased 17%, while direct to consumer revenues increased 12%, driven primarily by growth in North America and Western Europe, partially offset by declines in Asia.

Combined unit sales within the wholesale and direct to consumer channels increased 5% and ASP increased 9%, primarily due to higher full-price ASP, driven by lower discounts and growth in direct to consumer.

Reported EBIT increased 52%, driven by higher revenues and gross margin expansion partially offset by higher selling and administrative expense.

Gross margin increased approximately 250 basis points primarily due to higher margins in our direct to consumer business and a higher mix of full price sales, partially offset by higher product costs primarily due to increased freight charges.

Selling and administrative expense increased primarily due to higher demand creation expense driven by higher advertising and marketing expense.

FIRST SIX MONTHS OF FISCAL 2022 COMPARED TO FIRST SIX MONTHS OF FISCAL 2021

On a currency-neutral basis, Converse revenues increased 11% for the first six months of fiscal 2022 driven by revenue growth in North America and Western Europe, partially offset by declines in Asia.

Wholesale revenues increased 3%, while direct to consumer revenues increased 21%, driven by growth in North America and Western Europe, partially offset by declines in Asia.

Combined unit sales within the wholesale and direct to consumer channels decreased 2%, while ASP increased 12%, primarily due to higher full-price ASP, driven by lower discounts and growth in direct to consumer.

THIRD QUARTER OF FISCAL 2022 COMPARED TO THIRD QUARTER OF FISCAL 2021

On a currency-neutral basis, Converse revenues increased 2% for the third quarter of fiscal 2022 as revenue growth in North America and Western Europe was partially offset by declines in Asia.

Wholesale revenues decreased 14%, primarily due to ongoing marketplace dynamics in China and global supply chain constraints, while direct to consumer revenues increased 32%.

Combined unit sales within the wholesale and direct to consumer channels decreased 10%, while ASP increased 11%, driven by higher full price ASP, due to lower discounts and growth in direct to consumer.

Reported EBIT increased 12%, driven by gross margin expansion, partially offset by higher selling and administrative expense.

Gross margin increased approximately 410 basis points as decreased promotions and higher margins in direct to consumer,

favorable changes in standard foreign currency exchange rates, and higher ASP net of discounts were partially offset by higher product costs due to increased freight and logistics costs.

Selling and administrative expense increased due to higher operating overhead expense as a result of an increase in professional services costs.

Demand creation expense was relatively flat compared to the prior year.

FIRST NINE MONTHS OF FISCAL 2022 COMPARED TO FIRST NINE MONTHS OF FISCAL 2021

On a currency-neutral basis, Converse revenues increased 8% for the first nine months of fiscal 2022 as revenue growth in North America, Western Europe and licensee markets more than offset declines in Asia.

Wholesale revenues decreased 3%, primarily due to ongoing marketplace dynamics in China and global supply chain constraints, while direct to consumer revenues increased 25%.

Combined unit sales within the wholesale and direct to consumer channels decreased 5%, while ASP increased 11%, driven by higher full price ASP, due to lower discounts and growth in direct to consumer.

Reported EBIT increased 24%, driven by higher revenues and gross margin expansion, partially offset by higher selling and administrative expense.

Gross margin increased approximately 290 basis points primarily due to higher margins in our direct to consumer business, growth in licensee revenues and lower other costs, partially offset by higher product costs due to increased freight and duty charges.

Selling and administrative expense increased primarily due to higher demand creation expense driven by higher advertising and marketing expense.

THREE MONTHS ENDED NOVEMBER 30, SIX MONTHS ENDED NOVEMBER 30,

Gross margin increased approximately 330 basis points as higher margins in direct to consumer, favorable changes in standard foreign currency exchange rates, growth in licensee revenues, and higher ASP were slightly offset by higher product costs due to increased freight, duty and logistics costs.

Selling and administrative expense increased due to higher operating overhead and demand creation expense.

Operating overhead expense increased primarily due to an increase in professional services costs, while demand creation expense increased primarily due to higher advertising and marketing expense.

THREE MONTHS ENDED FEBRUARY 28, NINE MONTHS ENDED FEBRUARY 28,

(Dollars in millions)

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and certain other foreign currency derivative instruments.

SECOND QUARTER OF FISCAL 2022 COMPARED TO SECOND QUARTER OF FISCAL 2021

Corporate's loss before interest and taxes decreased $215 million for the second quarter of fiscal 2022, primarily due to the following:

• a favorable change of $198 million, primarily due to higher restructuring-related costs related to our organizational realignment in the prior year;

THIRD QUARTER OF FISCAL 2022 COMPARED TO THIRD QUARTER OF FISCAL 2021

Corporate's loss before interest and taxes decreased $70 million for the third quarter of fiscal 2022, primarily due to the following:

• a favorable change in net foreign currency gains and losses of $87 million related to the remeasurement of monetary assets and liabilities denominated in non-functional currencies and the impact of certain foreign currency derivative instruments, reported as a component of consolidated Other (income) expense, net;

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these results are reported as a component of consolidated gross margin;

FIRST SIX MONTHS OF FISCAL 2022 COMPARED TO FIRST SIX MONTHS OF FISCAL 2021

Corporate's loss before interest and taxes decreased $167 million for the first six months of fiscal 2022, primarily due to the following:

• a favorable change of $165 million, primarily due to higher restructuring-related costs related to our organizational realignment, as well as charges related to our planned, strategic distributor partnership transition within APLA, both of which occurred in the prior year;

• a favorable change of $41 million, primarily due to higher restructuring-related costs related to our organizational realignment in the prior year.

FIRST NINE MONTHS OF FISCAL 2022 COMPARED TO FIRST NINE MONTHS OF FISCAL 2021

Corporate's loss before interest and taxes decreased $237 million for the first nine months of fiscal 2022, primarily due to the following:

• a favorable change of $206 million largely due to higher restructuring-related costs associated with our organizational realignment as well as a net incremental charge related to our planned, strategic distributor partnership transition within APLA, both of which occurred in the prior year, partially offset by higher-wage related expenses in the first nine months of fiscal 2022;

• a favorable change in net foreign currency gains and losses of $125 million related to the remeasurement of monetary assets and liabilities denominated in non-functional currencies and the impact of certain foreign currency derivative instruments, reported as a component of consolidated Other (income) expense, net;

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We do not hold or issue derivative instruments for trading or speculative purposes.

As of and for the three and six months ended November 30, 2021, there have been no material changes to the Company's hedging program or strategy from what was disclosed within the Annual Report on Form 10-K.

As of and for the three and nine months ended February 28, 2022, there have been no material changes to the Company's hedging program or strategy from what was disclosed within the Annual Report on Form 10-K.

Refer to Note 4 — Fair Value Measurements and Note 9 — Risk Management and Derivatives in the accompanying Notes to the Unaudited Condensed Consolidated Financial Statements for additional description of outstanding derivatives at each reported period end.

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Dollars for consolidated reporting results in a cumulative translation adjustment to Accumulated other comprehensive income (loss) within Shareholders' equity.

The impact of foreign exchange rate fluctuations on the translation of our consolidated Revenues was a benefit of approximately $63 million and $445 million for the three and six months ended November 30, 2021, respectively, and a benefit of approximately $184 million and $73 million for the three and six months ended November 30, 2020, respectively.

The impact of foreign exchange rate fluctuations on the translation of our Income before income taxes was a benefit of approximately $12 million and $129 million for the three and six months ended November 30, 2021, respectively, and a benefit of approximately $63 million and $34 million for the three and six months ended November 30, 2020, respectively.

The impact of foreign exchange rate fluctuations on the translation of our consolidated Revenues was a detriment of approximately $280 million and a benefit $165 million for the three and nine months ended February 28, 2022, respectively, and a benefit of approximately $357 million and $430 million for the three and nine months ended February 28, 2021, respectively.

The impact of foreign exchange rate fluctuations on the translation of our Income before income taxes was a detriment of approximately $84 million and a benefit of $45 million for the three and nine months ended February 28, 2022, respectively, and a benefit of approximately $109 million and $143 million for the three and nine months ended February 28, 2021, respectively.

Management generally identifies hyper-inflationary markets as those markets whose cumulative inflation rate over a three-year period exceeds 100%.

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As a result, beginning in the second quarter of fiscal 2019, the functional currency of our Argentina subsidiary changed from the local currency to the U.S.

As of and for the three and six months ended November 30, 2021, this change did not have a material impact on our results of operations or financial condition, and we do not anticipate it will have a material impact in future periods based on current rates.

As of and for the three and nine months ended February 28, 2022,

this change did not have a material impact on our results of operations or financial condition, and we do not anticipate it will have a material impact in future periods based on current rates.

MANAGING TRANSLATIONAL EXPOSURES

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Dollar denominated available-for-sale investments are accounted for as cash flow hedges.

We estimate the combination of translation of foreign currency-denominated profits from our international businesses and the year-over-year change in foreign currency related gains and losses included in Other (income) expense, net had a favorable impact of approximately $63 million and $167 million on our Income before income taxes for the three and six months ended November 30, 2021, respectively.

We estimate the combination of translation of foreign currency-denominated profits from our international businesses and the year-over-year change in foreign currency related gains and losses included in Other (income) expense, net had a favorable impact of approximately $3 million and $170 million on our Income before income taxes for the three and nine months ended February 28, 2022, respectively.

LIQUIDITY AND CAPITAL RESOURCES

CASH FLOW ACTIVITY

Cash provided (used) by operations was an inflow of $3,868 million for the first six months of fiscal 2022, compared to $3,355 million for the first six months of fiscal 2021.

Net income, adjusted for non-cash items, generated $3,704 million of operating cash inflow for the first six months of fiscal 2022, compared to $3,283 million for the first six months of fiscal 2021.

The net change in working capital and other assets and liabilities resulted in an increase to Cash provided (used) by operations of $164 million for the first six months of fiscal 2022 compared to an increase of $72 million for the first six months of fiscal 2021.

The net change in working capital compared to the prior year was primarily driven by favorable impacts to Cash provided (used) by operations from Accounts receivable of $1,464 million, partially offset by unfavorable impacts from Inventories of $1,053 million for the first six months of fiscal 2022, in part due to supply chain constraints which caused a lower supply of available inventory to meet consumer demand during the first six months of fiscal 2022.

Cash provided (used) by investing activities was an outflow of $1,105 million for the first six months of fiscal 2022, compared to $2,877 million for the first six months of fiscal 2021, primarily driven by the net change in short-term investments.

For the first six months of fiscal 2022, the net change in short-term investments (including sales, maturities and purchases) resulted in a cash outflow of $776 million compared to a cash outflow of $2,789 million for the first six months of fiscal 2021.

Cash provided (used) by financing activities was an outflow of $1,846 million for the first six months of fiscal 2022 compared to $292 million for the first six months of fiscal 2021.

The increased outflow in the first six months of fiscal 2022 was driven by our resumption of the share repurchase program in the fourth quarter of fiscal 2021, resulting in $1,723 million of share repurchases for the first six months of fiscal 2022 compared to no share repurchases in the first six months of fiscal 2021.

During the first six months of fiscal 2022, we repurchased 10.8 million shares of NIKE's Class B Common Stock for $1.7 billion (an average price of $158.45 per share) under the four-year, $15 billion share repurchase program approved by the Board of Directors in June 2018.

As of November 30, 2021, we had repurchased 60.8 million shares at a cost of approximately $6.4 billion (an average price of $104.89 per share) under this program.

Cash provided (used) by operations was an inflow of $4,037 million for the first nine months of fiscal 2022, compared to $4,645 million for the first nine months of fiscal 2021.

Net income, adjusted for non-cash items, generated $5,387 million of operating cash inflow for the first nine months of fiscal 2022, compared to $4,840 million for the first nine months of fiscal 2021.

The net change in working capital and other assets and liabilities resulted in a decrease to Cash provided (used) by operations of $1,350 million for the first nine months of fiscal 2022 compared to $195 million for the first nine months of fiscal 2021.

For the first nine months of fiscal 2022, the net change in working capital compared to the prior year was primarily driven by unfavorable impacts to Cash provided (used) by operations from Inventories of $1,546 million, partially offset by favorable impacts from Accounts receivable of $1,303 million.

These changes are, in part, due to supply chain constraints, which caused higher levels of in-transit inventory and therefore a lower supply of available inventory to meet consumer demand.

Cash provided (used) by investing activities was an outflow of $1,711 million for the first nine months of fiscal 2022, compared to $3,987 million for the first nine months of fiscal 2021, primarily driven by the net change in short-term investments.

For the first nine months of fiscal 2022, the net change in short-term investments (including sales, maturities and purchases) resulted in a cash outflow of $1,156 million compared to a cash outflow of $3,650 million for the first nine months of fiscal 2021.

Cash provided (used) by financing activities was an outflow of $3,456 million for the first nine months of fiscal 2022 compared to $612 million for the first nine months of fiscal 2021.

The increased outflow in the first nine months of fiscal 2022 was driven by our resumption of the share repurchase program in the fourth quarter of fiscal 2021, resulting in $2,923 million of share repurchases for the first nine months of fiscal 2022 compared to no share repurchases in the first nine months of fiscal 2021.

During the first nine months of fiscal 2022, we repurchased 18.9 million shares of NIKE's Class B Common Stock for $2.9 billion (an average price of $155.28 per share) under the four-year, $15 billion share repurchase program approved by the Board of Directors in June 2018.

As of February 28, 2022, we had repurchased 68.9 million shares at a cost of approximately $7.6 billion (an average price of $110.31 per share) under this program.

We continue to expect funding of share repurchases will come from operating cash flows and excess cash.

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The Shelf expires on July 23, 2022.

As of November 30, 2021, our committed credit facilities were unchanged from the information previously reported on Form 10-K for the fiscal year ended May 31, 2021.

As of February 28, 2022, our committed credit facilities were unchanged from the information previously reported on Form 10-K for the fiscal year ended May 31, 2021.

We currently have long-term debt ratings of AA- and A1 from Standard and Poor's Corporation and Moody's Investor Services, respectively.

Any changes to these ratings could result in interest rate and facility fee changes.

As of November 30, 2021, we were in full compliance with the covenants under our facilities and believe it is unlikely we will fail to meet any of the covenants in the foreseeable future.

As of November 30, 2021 and May 31, 2021, no amounts were outstanding under our committed credit facilities.

As of February 28, 2022, we were in full compliance with the covenants under our facilities and believe it is unlikely we will fail to meet any of the covenants in the foreseeable future.

As of February 28, 2022 and May 31, 2021, no amounts were outstanding under our committed credit facilities.

On March 11, 2022, subsequent to the end of the third quarter of fiscal 2022, we entered into a 364-day committed credit facility agreement with a syndicate of banks which provides for up to $1 billion of borrowings, with the option to increase borrowings up to $1.5 billion in total with lender approval.

The facility matures on March 10, 2023, with an option to extend the maturity date an additional 364 days.

This facility replaces the prior $1 billion 364-day credit facility agreement entered into on March 15, 2021, which would have matured on March 14, 2022.

Refer to Note 5 — Short-Term Borrowings and Credit Lines for more information.

On March 11, 2022, we also entered into a five-year committed credit facility agreement with a syndicate of banks which provides for up to $2 billion of borrowings, with the option to increase borrowings up to $3 billion in total with lender approval.

The facility matures on March 11, 2027, with options to extend the maturity date up to an additional two years.

This facility replaces the prior $2 billion five-year credit facility agreement entered into on August 16, 2019, which would have matured on August 16, 2024.

Refer to Note 5 — Short-Term Borrowings and Credit Lines for more information.

Liquidity was also provided by our $3 billion commercial paper program.

As of and for the three months ended November 30, 2021, we did not have any borrowings outstanding under our $3 billion program.

We may continue to issue commercial paper or

other debt securities depending on general corporate needs.

As of and for the three months ended February 28, 2022, we did not have any borrowings outstanding under our $3 billion program.

We may issue commercial paper or other debt securities depending on general corporate needs.

We currently have short-term debt ratings of A1+ and P1 from Standard and Poor's Corporation and Moody's Investor Services, respectively.

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however, future volatility in the capital markets may increase costs associated with issuing commercial paper or other debt instruments or affect our ability to access those markets.

As of November 30, 2021, we had cash, cash equivalents and short-term investments totaling $15.1 billion, primarily consisting of commercial paper, corporate notes, deposits held at major banks, money market funds, U.S.

government sponsored enterprise obligations, U.S.

As of February 28, 2022, we had cash, cash equivalents and short-term investments totaling $13.5 billion, primarily consisting of commercial paper, corporate notes, deposits held at major banks, money market funds, U.S.

Treasury obligations and other investment grade fixed-income securities.

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All of our investments are investment grade to minimize our credit risk.

While individual securities have varying durations, as of November 30, 2021, the weighted average days to maturity of our cash equivalents and short-term investments portfolio was 62 days.

While individual securities have varying durations, as of February 28, 2022, the weighted average days to maturity of our cash equivalents and short-term investments portfolio was 59 days.

We believe that existing cash, cash equivalents, short-term investments and cash generated by operations, together with access to external sources of funds as described above, will be sufficient to meet our domestic and foreign capital needs in the foreseeable future.

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OFF-BALANCE SHEET ARRANGEMENTS

As of November 30, 2021, we did not have any off-balance sheet arrangements that have, or are reasonably likely to have, a material effect on our current or future financial condition, results of operations, liquidity, capital expenditures or capital resources.

As of February 28, 2022, we did not have any off-balance sheet arrangements that have, or are reasonably likely to have, a material effect on our current or future financial condition, results of operations, liquidity, capital expenditures or capital resources.

CONTRACTUAL OBLIGATIONS

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis