US sportswear company, Nike, has recorded a 5% increase in revenue to US$10.9 billion compared to the US$10.4 billion recorded a year prior.

Despite the increase in revenue, Nike saw a drop in net income by 4% from US$1.45 billion to $1.4 billion, with diluted earnings per share sitting at $US0.87 per share compared to US$0.90 per share last year.

Nike Direct, the company’s direct sales platform, recorded US$4.6 billion in revenue, an increase of 15% compared to the year prior.

Nike Direct, the company’s direct sales platform, recorded US$4.6 billion in revenue, an increase of 15% compared to the year prior.

Commenting on their direct-to-consumer strategy, Nike president and CEO, John Donahoe, said: “Nike’s strong results this quarter show that our Consumer Direct Acceleration strategy is working, as we invest to achieve our growth opportunities.”

“Fuelled by deep consumer connections, compelling product innovation and an expanding digital advantage, we have the right playbook to navigate volatility and create value through our relentless drive to serve the future of sport,” he said.

Nike Brand revenue saw an increase of 8%, to US$10.3 billion, led by 13% growth to US$2.8 billion in Europe, Asia and the Middle East.

North American revenue rose by 9% to US$3.9 billion, while Asia Pacific and Latin American saw 11% growth, and revenue fell by 5% in Greater China.

Elevated in-transit inventories and extended lead times from ongoing supply chain disruptions resulted in an increase of 15% in inventory compared to the year prior.

Commenting on the increase of inventories, Nike executive vice president and CFO, Matt Friend, said the marketplace demand continues to significantly exceed available inventory supply, with a healthy pull across Nike geographies.

Additionally, selling and administrative costs rose by 13% to US$3.4 billion, with demand creation expenses rising 20% to US$854 million and operating overhead expenses sitting at $2.6 billion, an 11% increase from last year.

Lastly, Nike reported approximately US$1.7 billion was returned to shareholders, including US$484 million in dividends, a 12% increase on last year.

The financial report marks the first quarter since Nike acquired RTFKT to help deliver next generation collectibles in December last year.