What should i do nike transcript

These innovations are resonating with consumers and have helped us nearly quadruple our yoga business over the past two years. Another key apparel story for us in Q1 was our bras business. And now to take a look at sustainability, look at what we've done with Space Hippie. Space Hippie as you may recall is quite literally made from trash and it was originally introduced at our Future Forum and debuted four separate sustainable material innovations for us including crater foam and space waste yarn.

Now since then we have strategically grown this franchise to global scale and what's more, we've also scaled these individual material innovations across our entire portfolio. So today, one year after that initial launch, there are more than 43 styles using Space Hippie innovations across four sports, three brands and our full consumer construct. For instance, you could see it come to life and iconic franchises such as the Air Force 1 Crater.

New performance innovation platforms like Cosmic Unity and even in our hands-free accessibility line with styles like Glide FlyEase. By driving new dimensions across platforms, our work to scale Space Hippies innovations catalyze growth. Consumers are clearly responding to sustainability as we're seeing very strong full price sell-through for this family of product, with vast opportunity to drive continued consumer and business value still ahead.

And this is just one example of how we lead with platforms and not just products. Our deliberate franchise and innovation management create scalable and sustainable impacts on our business and I'm excited by the upcoming new innovation platforms we'll be introducing soon. Next, let's discuss NIKE's increasing digital advantage.

We continue to lead the industry by creating a premium consistent and seamless experience that deepens relationships between consumers and our brand. Our advantage comes to life at retail in both digital as well as at the intersection of digital and physical. I'll discuss both here.

Even as physical retail revenue approach pre-pandemic levels, our digital business this quarter grew double-digits. This is the result of an unwavering focus on our strategy and the investments we've made against our end-to-end digital transformation. And so we continue to expect digital to be our leading channel for growth in fiscal ' Now one of the best agents for success in our digital business is how strongly we're connecting with members.

Our digital growth is led by outsized member buying, which has seen a penetration increase of 14 points since last year. Our membership strategy is working as we increasingly use data and analytics to personalize member product offering and experiences. Now part of our success stems from our constant focus on expanding what it means to be a NIKE member.

We brought this to life in Q1 by introducing a new launch experience, exclusive to the SNKRS app that revolutionizes how we serve consumers. The new experience debuted in one of the year's most highly anticipated launches the Off-White Dunk. This approach sends personalized purchase offers to members based on their engagement with SNKRS past purchase attempts and other criteria using data science to drive digital member targeting.

The result the Off-White Dunk end up in the hands of hundreds of thousands of our most deserving members creating what we call exclusivity at scale. And this improved consumer experience has a positive impact on the entire business. So our increasingly personalized approach to launch, along with benefits like member days an exclusive NIKE By You access highlights how we continue to increase the value proposition of NIKE membership.

We're also leveraging our digital advantage by investing in our brick-and-mortar fleet to create a compelling retail footprint that super charges how we serve consumers across physical and digital. A couple of weeks ago, I was in Los Angeles and toward some of our great retail there. And across each and every store what jumped out to me was our team. Their love for their community and their passion for our product and bringing it to life for consumers was inspiring and just awesome to see.

What's clear across the marketplace, both owned and partnered is how online to offline is becoming second nature.

We know that higher level of the connectivity across physical and digital are driving better consumer experience and loyalty. Other services such as buy-online-pick-up-in-store and ship-from-store, as well as the in-store shopping features of the NIKE app drive our premium and seamless consumer experience.

And we're starting to extend these innovative experiences globally. NIKE Seoul introduces new features to Rise rather including inside track and interactive RFID enabled digital footwear table where shoppers can compare details for any two shoes simply by placing them on the table. Our digitally connected retail experiences are clearly resonating with consumers. We're seeing over index growth from members, not just in digital, but also in physical retail with member buying penetration up double digits since last year.

And so, we'll continue expanding these compelling experiences across our fleet in fiscal '22, driving that interplay between physical and digital retail. In the end, NIKE is doing what we always do, staying on the offense. The strength of our consumer demand around the world continues to give us confidence in our playbook and execution. I said it earlier and I'll say it again, I am proud of our resilient and creative team across NIKE, Jordan and Converse and the work we continue to deliver for consumers.

Our confidence as we look long term has not changed one bit. We've already gotten stronger through this pandemic and we're going to emerge from it even stronger yet.

Thank you, John, and hello to everyone on the call today. NIKE's acceleration to a more direct member-centric business model continues to fuel deep connections between consumers and our portfolio of brands, drawing upon our culture of innovation, unmatched global scale and our industry-leading digital platform, we continue to serve the modern consumer as only NIKE can. Our first quarter results proved again that our strategy is working and NIKE's Consumer Direct Acceleration is fueling the transformation of our long-term financial model.

The NIKE brand remains distinctive and deeply connected in our key cities around the world from New York to Paris, Shanghai to Tokyo, NIKE continues to be consumers number one cool and favorite brand with a position that has gained strength as we've navigated through the pandemic.

Consumer demand for NIKE, Jordan and Converse remains incredibly high and our first quarter financial results would have been even stronger if not for supply chain congestion resulting in lack of available supply.

Despite these headwinds, retail sales still grew double digits versus the prior year, including a record-setting back-to-school season in North America.

Sneakers has increasingly become an indicator and barometer of brand heat, now being operational at scale in 50 countries around the world. And coming back to marketplace health for a moment, we delivered strong growth in average selling price this quarter with continued improvement in full price realization.

This performance reflects our intentional efforts to manage the health of our product franchises as demand surges to move available inventory to serve demand in the right channels and to drive a more premium experience for consumers.

As we accelerate our consumer led digital transformation, we are developing and refining new capabilities that are transforming our operating model, quickly becoming a competitive advantage for NIKE.

Central to these capabilities is scaling our digital first supply chain to enable NIKE's digital growth while optimizing service, cost, convenience and sustainability.

We are evolving our distribution network and forward deploying inventory closer to the consumer, leveraging data and advanced analytics. These actions will improve service levels, reduce carbon impact and ultimately reduce cost to fulfill an order.

Our regional service center outside of Los Angeles opened one year ago and we're excited with the opening of two more centers in Q1, pne on the East Coast and one in Spain. Our investments in Odoo services are putting our products in the path of more consumers and more efficiently optimizing our inventory. Our Express Lane offense is also creating more and more agility across our portfolio from creating locally relevant product on shorter lead times to leveraging a shared inventory pool across the marketplace.

We are better conserving consumers with more operational flexibility, yielding higher profitability. And last, the NIKE App continues to enable a convergence between physical and digital shopping journeys, eliminating friction for consumers. From member driven personalization and localization to building an endless aisle through digital integration with our most important wholesale partners, Consumer Direct Acceleration is transforming NIKE's operating model to move at the speed of the consumer.

Now, let me turn to the details of our first quarter financial results and operating segment performance. Gross margin increased basis points versus the prior year, driven primarily by higher NIKE Direct margins and partially offset by increased ocean freight surcharges. This was due to higher wage related expenses, higher levels of brand activity connected to return to sport and strategic technology investments.

This was due to increased benefits from stock-based compensation and discrete items, offset by a shift in our earnings mix. Now, let's move to our operating segments. Demand for NIKE remained incredibly strong for the fifth consecutive season, energized this quarter by back-to-school and the return to sport.

Retail sales for our Performance business grew strong double digits during the fall season, led by running, fitness and basketball, powered by excitement from the Olympics, the new WNBA season and the NBA finals. This was driven by highly elevated in-transit inventory levels as transit times in North America deteriorated during the last quarter, now almost twice as long as pre-pandemic levels. This impacted product availability across the marketplace and our ability to serve strong levels of consumer demand, particularly in the wholesale channels.

Closeout inventory was down double digits versus the prior year. This region was energized by the EURO this summer, where NIKE players scored more goals than all other brands combined and more than half of those goals were with our Mercurial boots.

We saw a strong consumer response to both the Mercurial boot and replica jerseys during the tournament. Following a full reopening, we saw traffic increase by double digits versus the prior year, with better than expected conversion rates.

Transit times to EMEA have also deteriorated over the past 90 days, causing higher levels of in-transit inventory and negatively impacting product availability to serve strong consumer demand. Prior to late July, physical traffic had been approaching prior year levels.

In July, we engaged with consumers through the launch of our joy of sports local marketing campaign. We experienced a strong 6. Our experienced local team continues to navigate through marketplace dynamics. Now moving to APLA. This collaboration drove more than half of day 1 sales and highlights how digital and physical experiences are converging in our own stores, leveraging local insights and a more agile supply model.

Now, I will turn to our financial outlook. Consumer demand for NIKE remains at an all time high and we are confident that our deep consumer connections and brand momentum will continue. However, we are not immune to the global supply chain headwinds that are challenging the manufacturer and movement of product around the world. Previously, I had shared that we were planning for transit times to remain elevated for the balance of fiscal ' Unfortunately, the situation deteriorated even further in the first quarter with North America and EMEA seeing increases in transit times due primarily to port and rail congestion and labor shortages.

Additionally, several of our factory partners in Vietnam and Indonesia were required to abruptly cease operations in the first quarter. As of today, Indonesia is now fully operational, but in Vietnam nearly all footwear factories remain closed by government mandate.

Our experience with COVID related factory closures suggests that reopening and ramping back to full production scale will take time. Therefore, we're revising our short-term financial outlook to incorporate the following factors: 10 weeks of production already lost in Vietnam since mid July.

Factory reopening to occur in phases beginning in October with a ramp to full production over several months and elevated transit times consistent with where we are now operating today. We now expect fiscal '22 revenue to grow mid single digits versus the prior year versus our prior guidance of low double-digit growth due solely to the supply chain impacts that I just described.

Specifically for Q2, we expect revenue growth to be flat to down low-single digits versus the prior year as factory closures have impacted production and delivery times for the holiday and spring seasons. Lost weeks of production combined with longer transit times will lead to short-term inventory shortages in the marketplace for the next few quarters. We expect all geographies to be impacted by these factors.

However, those geographies in Asia with less in-transit inventory at the end of the first quarter will experience a disproportionate impact beginning in Q2.

For the balance of fiscal '22, we expect strong marketplace demand to exceed available supply. We are optimistic inventory supply availability will improve heading into fiscal '23 against the backdrop of a very strong brand and healthy pull market across all geographies.

We still expect gross margin to expand basis points versus the prior year, at the low end of our prior guidance, reflecting stronger than expected full price realization, the ongoing shift to our more profitable NIKE Direct business and price increases in the second half. This more than offsets roughly basis points of additional transportation, logistics and airfreight costs to move inventory in this dynamic environment. We also expect a lower foreign exchange benefit now estimated to be a tailwind of roughly 60 basis points.

And for the second quarter, we expect gross margin to expand at a rate lower than the full year due to higher planned airfreight investment for the holiday season. We intend to maintain our position as the number one cool and favorite brand and to celebrate the return to sport as we inspire and engage consumers around the world.

We will also maintain pace on our multi-year investment plans in order to transform our business for the future as I've outlined in prior quarters. NIKE's financial strength is a competitive advantage and it is in moments like these where our competitive strengths and strong balance sheet affords us the ability to remain focused on what's required to win and serve consumers for the long term.

In closing, our vision for NIKE's long-term future remains unchanged. NIKE is a growth company with unlimited potential. Despite new short term operational dynamics, our consumer-direct acceleration offense is driving our business forward and transforming our financial model toward the long-term fiscal '25 financial outlook I shared last quarter. This quarter's impressive results are additional proof that our strategy is right, not only for the moment we find ourselves in, but also for the opportunity to serve the future of athlete and sport like only NIKE can.

I wouldn't trade our position with anyone. And there is no better team to navigate through volatility and lead long-term transformational change. Great, thanks, good afternoon. And really appreciate the update on what you're seeing real-time in the supply chain.

I guess my question relatedly is, are there any, if you look to the fall and back half -- holiday season. Are there any key footwear franchises that are being more impacted than others?

And then when you zoom back and think about the longer-term, what type of investments do you plan to continue to make within the supply chain to continue to improve your agility?

Thanks so much. Aaron, thanks for the question. There are several aspects to the current supply chain challenges that are probably not intuitive, just based on my prepared remarks and so let me take a couple of minutes to try to break it down further.

As I said earlier, consumer demand has never been higher and we expect strong demand to continue for quarters to come. Over the last 90 days. First, already long transit times worsened and second local government-mandated shutdowns in Vietnam and Indonesia.

Keep in mind that there are global complexities and differences in transit times and sourcing mix across our geographies. So I'm going to use North America as an example, to just go a little deeper on what I'm talking about. Prior to the pandemic, it would have taken approximately 40 days to move product from Asia to North America. Transit times have been increasing due to container shortages, port congestion, rail congestion and labor shortages, impacting the entire industry.

And during Q1, these lead times worsened further to now sit at 80 days, roughly 2 times normal. So here's where the geo-specific piece comes in. So as we finished Q1 with higher levels of in-transit inventory that means that we had full price inventory that was unavailable to use to serve current consumer demand in this quarter. We would have had an even stronger top line result if we had more product available to serve that consumer demand.

And so these elevated transit times that we're seeing we've been talking about them now for several quarters and they worsened this quarter continue to have an impact on our business. And then in addition to that, there is Vietnam and it's important to think about these two impacts together.

So through this week that means we've already lost 10 weeks of production and that gap will continue until factories are able to reopen and produce product at normal capacity. So this has created a gap to the flow of inventory originally ordered for delivery beginning in mid-October.

And our experience shows us based on navigating through this pandemic over the last 18 months, it is going to take several months to ramp back to full production. Now on a positive note, a few factories have just had their reopening plans approved, like this week. And so we're optimistic about a phase reopening and ramp of production beginning in October. And as I said in the call -- earlier in the call, Indonesia is already operational and they're ramping back up to capacity.

So North America is coming into Q2 with elevated in-transit inventory, which means North America will have higher quantities of fall season product that it can sell in the second quarter, but holiday and spring production has been delayed.

And if you combine that with longer lead times, the impact of the lost production is going to have a greater impact in North America in Q3. Conversely, Greater China which has lower levels of in-transit inventory and shorter transit times because it's closer to the factories, is going to experience the impact of the lost production earlier in Q2. Our teams are leveraging their experience in our operational playbook and taking actions to try to mitigate these impacts and they're doing things like maximizing our footwear production capacity in other countries, shifting apparel production out of Vietnam to other countries like Indonesia and China and others where viable, strategically leveraging airfreight.

And then we're continuing to employ a season-less approach to product to serve incredibly strong consumer demand given our success that we've had selling at full price even if the product reaches the market later than we expected. So while the environment is dynamic, these supply chain issues we believe are temporary and from what we can see today, we're optimistic that available inventory supply will be improved as we head into fiscal year ' And Aaron to the second part of your question on in that context investment, we're doing what strong companies do during periods of time like this.

We're going to continue to invest in innovation and product creation and brand and storytelling and support of sport being back and our strong sports marketing portfolio and our digital transformation. So that's continuing. And then we'll continue with strong presence around driving demand and brand even in the face of a supply constrained market and as Matt mentioned, accelerate air transportation and other things in our supply chain that allow us to take -- manage every lever we can in this supply chain constrained environment.

So we're going to -- we again -- our mantra going into this next phase is the same mantra we had going into the first phase of the pandemic. Let's make sure we emerge stronger coming out of it than we have even today going in. Great, thanks. Can you leverage size, scale and innovation to accelerate market share? And then Matt, real quick, just on the revised gross margin outlook for this year, aside from the supply chain impact, I guess my question is, could you speak to maybe some of the underlying drivers?

It sounds like full price selling, digital margin is on track. I mean, aside from the supply chain dynamics, does anything really change? Meaning, do you see this is fully transitory and any change to the multi-year gross margin outlook? Matthew, on the first part of your question, the healthier athletic market is in our remarks. Sport is back and that is just such an energizing and important thing for NIKE and we saw that this summer. I won't go back through it, whether it's the Olympics, basketball, Global Football, incredible U.

Open Tennis. I mean, it's -- so, I would say traditional sport is what I'll call it is strong and back and that's also happening now in high schools and great schools as kids come back to school.

Second thing we're seeing is the expansion of the definition of sport, whether that's in the Olympics with sports like skate being included for the first time, some of the most exciting moments in the Olympics was around skate. And that young generation, Gen Z generation really dominating remarkably in a very compelling way, but also coming out of the pandemic, the definition of sport I think is getting to every athlete aspirates in different ways.

Just the concept of movement and health and the fact that sports can happen in your living room, as well as going to the gym or the yoga studio or the basketball court. And so part of the tailwind we're seeing is sport is becoming part of everyone's everyday life. And that's a powerful tailwind for us. And then athleisure that boring line between the sport part of your life and the rest of your life is also what we view as a tailwind.

So, we're doubling down on traditional sport and on capitalizing on these -- the new emerging definition of sport, you saw that in skate in the Olympics, you see that in some of our brand campaigns, being really close to where that Gen Z consumer is.

And we think that bodes well for our future. And I'll just hit the gross margin, quickly, Matt. We believe that this quarter was an excellent proof point of the success that we're seeing in driving our consumer-led digital transformation. Looking at Q4 and the full fiscal year we just concluded, our strong business results proved yet again NIKE's unique competitive advantage. Our relentless focus on our objectives is clear and our strategy is working.

We're excited by the momentum we continue to see. This full-year growth was led by our owned digital business, which is now more than double versus fiscal '19, prior to the pandemic. I've said before, these are times when strong brands can get stronger. And each quarter this reality becomes even more clear. Today, we are better positioned to drive sustainable long-term growth than we were before the pandemic.

Our team has proven their ability to be unrelenting and executing against the macro complexities while also building the future. One of NIKE's strengths is our diverse global portfolio. And through the power of that portfolio, we once again over delivered on our expectations for the quarter. As we look ahead to fiscal '22, the opportunity ahead of us is significant.

We remain very confident in our long-term strategy and our growth outlook. The structural tailwinds we discussed before, including the return to sport and permanent shifts in consumer behavior toward digital and health and wellness continue to create energy for us. And we remain focused on our largest growth drivers, including our women's business, apparel, Jordan and international. NIKE sets the pace through a continuous flow of new innovation, the world's greatest roster of athletes and compelling experiences for consumers that create lifelong relationships with our brand.

Our strengths and proven playbook give us the confidence to move even faster to invest even a more accelerated pace against the opportunities we see ahead. As the world's largest athletic, footwear and apparel brand we take seriously our leadership position to promote sport participation and an active lifestyle through inspiration and innovation.

Our goal isn't merely to take market share. Our goal is also to grow the entire market. NIKE's growth has been and will continue to be the result of three areas I'll walk through today. Connecting with consumers through compelling brand experiences across NIKE Jordan and Converse, driving product innovation against our greatest growth opportunities and expanding our digital advantage. First, let's discuss how we serve consumers.

As sport continues to return, NIKE leads with our unique rich heritage and our deep roster of global superstars and up new comers who connect us with consumers everywhere.

Euro started two weeks ago with Cristiano Ronaldo becoming the leading scorer in Euros history. England, France, Portugal and the Netherlands are among the teams with great momentum heading into the tournament's next stage.

And we're proud that more goals have been scored thus far wearing NIKE boots than all other brands combined. On the club side, Chelsea won the Champions League on the men's side and Barcelona was the top team on the women's side.

We remain excited for the power of sport on full display during the Olympics and Paralympics in Tokyo this summer and in Beijing next year. This authentic connection with consumers is also fueled by our belief in redefining how we open access to sports for consumers everywhere. Our recent campaign Play New, launched in May kicking off our largest ever invitation to Gen Z and marking the ignition point of a month long rally around finding joy and movement in play.

And their response has been remarkable. The apps augmented reality lenses featuring yoga, dance, and [Indecipherable] led to more than million Gen Z impressions in just the first two weeks. Earlier I mentioned our goal to grow the market well by inspiring people to try something for the first time, we vastly expand the community of athletes.

And we continue to bring the emotion and power of our brand to life through our digital ecosystem, which is led by the sneakers out. We're now offering this growing audience of high-value members in almost daily flow of compelling content and product launches. For Air Max Day in March, six different live stream events gave sneakers live its highest viewership ever. So whether it's through sneakers live or user generated style inspiration, sneakers is the perfect intersection of content, community and commerce.

Moving to my second point, our relentless pipeline of innovative product continues to create separation between us and our competition. Our product is fueled by sharp consumer insight supported by marketing data and analytics as we continue to invest in our digital transformation. And through our new operating model, we are bringing more precision to the art of product creation as we blend the heart and science of innovation.

For Q4, let me touch on two great examples of how we're investing in our top growth opportunities, our women's business and Jordan brand. We're investing and focused across the entire value chain to unlock the vast opportunity we see for women's. And despite the tremendous momentum we're seeing in women's, we know that there is even greater growth ahead as we move even faster with our new organization structure and invest far more resources in serving women end-to-end.

For instance, in the marketplace, we continue to provide more compelling retail environment through our NIKE Live format. In fact, this past year, we opened nine new NIKE Live doors, which offer personalized experiences and services for female consumers. Our investments also mean a larger sharper focus on women's only insights, services and product innovation. And we're already seeing this work come to life. Consumer insight from our female consumer drove the new Pegasus 38, which kept the best cushioning innovations from this popular franchise while improving and tailoring comfort and fit that she wants.

The Peg 38 has sold extremely well and we continue to be energized by the potential we see in footwear for her. For WNBA's 25th season this year, we created the most comprehensive player, team, and fan apparel collection in league history. The new WNBA uniforms were completely reengineered to deliver the exact fit, movement, and comfort players said that they want from their Jersey and sport.

The players love them and consumers have agreed, with sales growth well above our expectations. And that heightened demand extended to the larger product assortment with the WNBA 25th anniversary T selling out in one day. This is just one example of how we drive energy for women's sport across the marketplace, as we remain excited by this enormous opportunity looking forward.

Next, let's discuss Jordan brand whose momentum continues to be driven by its unique blend of heritage and innovation as well as its deep connections to consumers and communities around the globe. This growth was driven by continued energy for Jordan's most coveted icons including the AJ1 and AJ11 as well as new product dimensions. For example, Jordan's women's business nearly tripled in Q4, fueled by compelling product such as the flight essentials apparel collection.

In Q4, Jordan also launched Zion Williamson's first signature shoe, the Zion 1 as well as the apparel collection. As the first Gen Z signature shoe in Jordan brands history, Zion offers both transcended athletic possibility as well as a deep personal connection with fans. The strong sell-through of Zion signature shoe collection demonstrates the continued love for Jordan brands roster of athletes all over the world. Quickly looking to the summer in Tokyo.

In the next few weeks, we will be officially launching more of our Olympic product including our USA women's basketball and football uniforms, our four skateboarding Federation kits, and a new medal stand shoe featuring our hands-free FlyEase technology. We're excited by the strong reaction we've seen for our Olympic product thus far. And we're also thrilled to see our innovation continue to separate us. As you probably heard, our spikes are creating dominant performances at the US track and field trials, not just for NIKE athletes but competitor athletes as well.

From performance to the medal stand, to sustainability, we're excited for the world stage this summer in Tokyo to put a global spotlight on our advantage and innovation. One final observation on innovation. I recently got the chance to see the long-term product plans that our teams are developing against our new consumer construct of women's, men's, kids and Jordan, with sharpness against poor performance and sport lifestyle and I could not be more excited.

It's safe to say that we're more confident than ever in our product pipeline, as our focus on the consumer of the future drives our relentless innovation engine. And as we start welcoming employees back to work in our new state-of-the-art design and innovation centers, I know that our innovation pace will only quicken as we reinvent what's possible. My third and final point is increasing our digital advantage.

This is the result of deeper consumer connections fueled by compelling product and content. A key differentiator for us is membership. It has proven to be a compelling driver of repeat engagement and buying across digital and physical retail.

This member demand growth was underscored by strong results across the consumer funnel including member engagement, average order value and buying frequency. In this fiscal year, we met the goals we set at our last Investor Day around membership of full year early and now have more than million NIKE members. More importantly buying member growth is outpacing new member growth, signaling progress on a deeper member led commerce funnel.

We're always looking to elevate our unique member proposition, whether that means expanding the number of member exclusive products or creating new and meaningful retail experiences through Member Days, our NIKE only retail moments. And this engaging membership experience fuels a virtuous cycle feeding insight to product creation, inventory optimization and more.

Knowing and serving our members drives greater competitive separation. Today, we're the clear leaders in our industry and we continue to see digital as our leading channel for growth in fiscal ' And we see no sign of this shift slowing. As part of our overall One Nike Marketplace, we are also actively engaged with our strategic wholesale partners who share our vision.

Today, we're working closely with large strategic partners like Dick's Sporting Goods, Foot Locker, and JD Sports, as well as compelling local neighborhood partners who are authentic to sport performance and lifestyle. Together, we are driving change to create a new more connected and seamless experience for consumers around the world, which is exactly what consumers want. It's a shift that speaks to our belief that the strong get stronger.

We're super charging how we serve consumers with convenience, innovation, content and services. This is how we stay ahead of the pack and expand our lead. We've all been through a lot this past year.

And at NIKE that's included store closures, supply chain challenges, digital transformation, a new accelerated strategy and more. And throughout it all our team has delivered for our consumers and communities.

You've demonstrated creativity, teamwork, and resilience and you are the reason NIKE leads. I've said it before and I'll say it again, the people of NIKE are our greatest competitive advantage.

Thank you, John and hello to everyone on the call today. Before I begin my prepared remarks, I too want to take a moment to thank our incredible team.

They've delivered extraordinary results over the past year. Thank you, Andy for your leadership and specifically for your support in my transition to CFO last year. I wish you the best of luck in your new role, I know you'll do great. And backfilling Andy in this role as Paul Trussell, who many of you already know.

Paul joins us from Deutsche Bank. And we're excited to welcome him to the NIKE team. Now I'd like to begin today's call with a baseline on where we are in our recovery. Just as we anticipated, NIKE is emerging from the pandemic stronger and better positioned to serve the consumer. And the reason for this is clear. NIKE's Consumer Direct Acceleration is fueling a deeper consumer connection with our brands and driving business results, although highlighting in greater strategic and financial opportunity ahead.

Over the past 15 months we have navigated through this challenging environment with outstanding execution of our operational playbook.

We have faced every challenge head on, focused on what we could control, all while keeping the consumer at the center. These actions had help set a strong foundation for sustainable growth and profitability with business performance, now exceeding pre-pandemic levels. And finally, our fiscal '21 EBIT margin reached These metrics now become the new baseline from which we expect to grow. As we recover from the global pandemic, it is clear that our Consumer Direct Acceleration strategy is transforming NIKE's financial model.

So later on the call, I will share our financial outlook through fiscal year '25, reflecting a more direct member-centric business model. However, first I would like to provide additional detail on our extraordinary fourth quarter results and operating segment performance. NIKE Inc. This was driven by strong wholesale shipments and NIKE owned store performance as we anniversary pandemic related store closures.

Gross margin increased basis points versus the prior year, driven by favorable NIKE Direct margins and the anniversary of higher costs including actions taken to manage supply and demand in the face of the COVID pandemic. Digital marketing to drive digital demand, technology investments to support our digital transformation and higher wage related expenses. Our effective tax rate for the quarter was Now let's move to our operating segments.

Demand for NIKE remained incredibly strong. And as we expected, delayed revenue from the global supply chain disruption in the third quarter was recaptured during the fourth quarter.

NIKE Direct performance was propelled by our members across both digital and physical retail. Across the total marketplace, we continue to see strong retail sales growth and consumer demand for our brands exceeding marketplace supply, with marketplace inventory down double digits versus the prior year. In transit full price inventory remains elevated as we continue to experience longer end to end lead times for supply.

We expect supply chain delays and higher logistics costs to persist throughout much of fiscal ' In May, as restrictions eased, we saw a strong consumer response with incredible pent-up demand and this momentum has continued into June. Through our Member Days, we saw strong engagement with member demand outpacing total NIKE Direct revenue growth with all-time highs for female active members during Air Max week.

In the fourth quarter, we also expanded the NIKE mobile app to more than 10 new countries across the region. During our last earnings call, I shared our expectation that inventory in EMEA would normalize in the first quarter of fiscal ' We have exceeded that goal due to stronger-than-anticipated consumer demand, ending fiscal '21 in a healthy and normalized inventory position. For the full year, Greater China delivered its seventh consecutive year of double-digit growth, demonstrating our consistent brand strength and commitment to serving the consumer.

As John mentioned earlier, Q4 business results were impacted by marketplace dynamics. After a strong March, our business in Greater China was impacted in April and we adjusted our operations by suspending marketing activities and product launches.

We then began to see a recovery trend improving to a single-digit decline in May and sequentially improving into June with month-to-date retail sales trends approaching prior year levels. And for the 6. Building on our year history in Greater China, we continue to invest in serving consumers with the best products NIKE has to offer in locally relevant ways.

We also continue to invest in the creation of a premium seamless consumer digital experience. And supply chain capabilities and we plan to open a new digital technology center in Shenzhen to better serve Chinese consumers. We have an experienced local team in Greater China who helped create our operational playbook at the beginning of the pandemic.

They have proactively managed marketplace supply and demand in order to navigate through these dynamics. And we expect inventory to be normalized by the end of Q2. Now moving to APLA. This was highlighted by Member Days, which drove all-time highs for member demand.

This momentum also extended to our marketplace partners in APLA as they returned to growth versus pre-pandemic levels and achieved their highest level of full price realizations, since the beginning of the pandemic. During Golden Week in Japan, the Express Lane assortment was heavily influenced by member insights and delivered a sell-through rate that was two times the rate of the rest of NIKE Digital in Japan, showcasing the power of blending art and science that John referenced earlier.

APLA was the last geography to launch our Express Lane offense and we see significant opportunity to leverage these capabilities to drive deeper authentic consumer connections across the region. Now, as we look ahead to fiscal '22 and beyond, I want to provide a new financial outlook through fiscal ' As we emerge from the pandemic accelerate our Consumer Direct Strategy and transform the operating model of the company. First of all NIKE is a growth company and we expect to sustain strong revenue growth going forward.

This is based on the significant market opportunity that we see for our brands across the portfolio. As well as our accelerated shift to a more direct member-centric business model. As a result, we expect revenue growth to inflect upwards to a range of high single-digit to low double-digit growth on average.

With outsized marketplace opportunities in women's, apparel, Jordan, digital and international. We will continue reshaping our wholesale business portfolio which includes divesting from undifferentiated retail, while investing in our strategic wholesale partners for healthy growth. Overall, we expect wholesale revenue to remain roughly flat versus fiscal ' We will support partners who continue to authenticate our brand as well as those who have the scale to create a consistent premium digitally connected experience for consumers across the marketplace.

Our longer-term revenue outlook reflects higher growth expectations across several operating segments. We will continue to leverage the power of our diverse global portfolio. And we expect on average, North America to grow mid-single to high-single digits. And with respect to Greater China, while marketplace dynamics still exist, we are optimistic that we can continue to grow low to mid-teens over the long term. We remain committed to investing in the local consumer experience and inspiring the next generation of athletes in China.

We will continue to serve consumers with NIKE performance innovation and sports style product franchises, while also increasing local customization of style and fit for consumers. For several quarters now, I've highlighted that the strategic and financial benefit of shifting to a higher mix of business through NIKE Direct led by digital and leveraging enhanced data and analytics capabilities to optimize inventory, drive higher full-price realization and lower digital fulfillment costs.

We now see gross margin rate reaching the high 40s by fiscal ' We will continue to reallocate resources and invest to enable our digital transformation and fuel the long-term growth and profitability opportunities that we see. As a result of all of this, we see our EBIT margin reaching high teens by fiscal '25 with earnings-per-share growth of mid to high-teens on average over this period.

As we drive toward a more direct business model we remain committed to create long-term value for our shareholders through serving consumers and sustaining our disciplined financial management. And deliver consistent returns to shareholders through dividends and share repurchases.