That Nike Store You Walked In To Made $34 Million For Nike Stock

Nike (NYSE: NKE) is the largest sportswear company in the world. The company has achieved unprecedented growth in the apparel industry and continues to expand. This growth was driven by the good performance of retail (store) channels as well as direct-to-consumer channels. Nike has been able to adapt quickly to changing market dynamics, with the company’s DTC (e-commerce and direct stores) segment experiencing phenomenal growth over the past two years, enabling average Nike store revenue to exceed $34 million in 2018.

Trefis compare average revenue per store for sportswear companies Nike, Under Armour, and Lululemon in its interactive dashboard and concludes that Nike’s average revenue per store of $34 million in 2018 is more than 3 times that of its competitor Under Armour.

How does the average revenue per store of sportswear companies compare to each other?

*Includes total revenue for calculating revenue by store

  • Sportswear companies refer to companies that primarily sell sportswear and footwear. Although a large percentage of products are worn for casual or leisure purposes, the focus of these companies is to develop sportswear products.
  • Among sportswear companies, Nike has the highest average revenue per store of $34 million.
  • On the other hand, other activewear companies are lagging far behind, with Under Armor generating sales of $10.4 million per store while Lululemon was even further behind at $7.5 million.

How does the number of sportswear company stores compare to each other?

  • Notably, Nike has the most number of stores among sportswear companies. Nike’s store count of 1,150 at the end of 2018 was more than double that of Under Armour’s 498. Lululemon was further behind at 440.
  • However, over the 2015-2018 period, Under Armor rapidly increased its store count, with the company opening over 150 new stores (net of closures).

What has been the trend in Nike’s average revenue per store over the past few years?

  • Nike’s average revenue per store increased 10% between 2015 and 2018, from $31 million in 2015 to $34 million in 2018.
  • Although Nike opened 154 new stores during this period, Nike’s revenue growth far exceeded new store openings.
  • Nike revenue grew 21% over the past four years, driven by growth in NIKE Direct and wholesale, key categories such as Sportswear and the Jordan brand, and growth continues shoes and clothes.
  • Under Armor’s average revenue per store has steadily declined over the past two years
  • Lululemon’s average revenue per store has seen robust growth over the years

Additional details on how average store revenues for Lululemon and Under Armor have changed in recent years are available in our interactive dashboard.

Conclusion: Nike is the market leader and has done well to consolidate its position over the years

  • Nike has achieved robust growth over the years and shows no signs of slowing down.
  • Despite having more stores, Nike’s average revenue per store is significantly higher than its peers.
  • Although Lululemon is growing at a faster rate than Nike, it has a smaller scale than Nike.
  • Given Nike’s consumer reach and geographic penetration, it’s highly unlikely that any other sportswear company will be able to match Nike’s position in the apparel market.

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