Good afternoon, everyone. Welcome to NIKE, Inc.’s Fiscal 2017 Fourth Quarter Conference Call. For those who need your reference today’s press release, you’ll find it at investors.NIKE.com. Leading today’s call is Nitesh Sharan, Vice President, Investor Relations and Treasurer. Before I turn the call over to Mr. Sharan, let me remind you that participants on this call will make forward-looking statements based on current expectations and those statements are subject to certain risks and uncertainties that could cause actual results to differ materially. These risks and uncertainties are detailed in the reports filed with the SEC, including the Annual Report filed on Form 10-K. Some forward-looking statements may concern future orders, expectations of revenue -- future revenue growth or gross margin. Following the conference call, our futures order schedule will be posted on the NIKE Investor Relations website. Finally, participants may discuss non-GAAP financial measures, including references to wholesale equivalent sales and constant dollar revenue. References to wholesale equivalent sales are only intended to provide context as to the overall current market footprint of the brands owned by NIKE, Inc. and should not be relied upon as a financial measure of actual results. Similarly, references to constant dollar revenue are intended to provide context as to the performance of the business eliminating foreign exchange fluctuations. Participants may also make references to other non-public financial and statistical information and non-GAAP financial measures. To the extent non-public financial and statistical information is discussed, presentations of comparable GAAP measures and quantitative reconciliations will be made available at NIKE’s website, investors.NIKE.com. Now, I would like to turn the call over to Nitesh Sharan, Vice President, Investor Relations and Treasurer.

Thank you, Operator. Hello, everyone. And thank you for joining us today to discuss NIKE, Inc.’s fiscal 2017 fourth quarter and full year results. As the operator indicated, participants on today’s call may discuss non-GAAP financial measures. You will find the appropriate reconciliations in our press release which was issued about an hour ago or at our website, investors.NIKE.com. Joining us on today’s call will be NIKE, Inc’s Chairman, President and CEO, Mark Parker, followed by Trevor Edwards, President of the NIKE Brand; and finally you will hear from our Chief Financial Officer, Andy Campion, who will give you an in-depth review of our financial results. Following their prepared remarks, we will take your questions. We would like to allow as many of you to ask questions as possible in our allotted time. So, we would appreciate you limiting your initial questions to two. In the event, you have additional questions that are not covered by others, please feel free to re-queue and we will do our best to come back to you. Thanks for your cooperation on this. I’ll now turn the call over to NIKE, Inc. Chairman, President and CEO, Mark Parker.

Thanks, Nitesh and hello, and good afternoon, everyone. Serving athletes in today’s quickly evolving marketplace demands a new approach. It means rethinking the fundamentals with an action plan that focuses on speed and deeper connections with consumers. In fiscal 2017, we managed our business through this dynamic environment, while at the same time we initiated big changes to set the stage for our future. It was a year for making aggressive moves. All with a goal of igniting the next phase of accelerated growth for NIKE. So let’s take a look at the numbers for the year. NIKE, Inc. revenues grew 6% to $34.4 billion on a reported basis. On a currency neutral basis, NIKE, Inc. revenues grew 8%. Gross margin declined 160 basis points to 44.6%. Earnings per share rose 16% to $2.51 and we delivered ROIC of nearly 35%. As I reflect on the year and what the consumer is telling us, three insights stand out. First, the consumer appetite for newness and choice has never been higher. Their connected world means unlimited access to new products. So when they see something they love, they want more versions of it from performance innovation to style. For example, this year the introduction of the Air VaporMax energized the whole Air platform. Five of our top 10 sportswear styles featured Air Max cushioning, adding fuel to a NIKE Air business that already represents several billion dollars. Second, consumers are choosing brands who lead with elevated service and new experiences. They want brands that are engaged and make a personal connection. Our opportunity is to create more compelling experiences in NIKE environments and with our best partners. Third, consumers want the latest products faster. This year we continue to build more agility and speed into our organization. We’re becoming better editors…

Thank you, Mark. In Q4 and throughout fiscal year ‘17, the NIKE Brand delivered strong growth, demonstrating again the power of our uniquely diverse global portfolio. As always, my comments are on a constant currency basis. NIKE Brand revenue grew 7% for the quarter and 8% for the year with double-digit growth internationally in all quarters this fiscal year. NIKE Brand DTC revenue was up 12% for the quarter. For the year, DTC revenue was up 18% driven by online growth of 30%, new stores and comp store growth of 7%. The NIKE brand is strong with an unmatched ability to inspire consumers across the globe. And while we are seeing healthy growth across many dimensions of our business, we know ample opportunity remains. With our new Consumer Direct Offense, we are more focused than ever on amplifying those areas where we have momentum and accelerating those where we have opportunity. We’re doing this by bringing the NIKE Brand closer to consumers, moving faster and serving them more completely. Mark discussed how our new offense is moving decision-making closer to our consumers, so that we may move at their pace, if not a step ahead. Let me briefly share the work we’re doing in the marketplace and how we expect it to drive even greater growth. We have a uniquely powerful connection with our consumers. They want to be a part of our brands. They want a relationship and that means we think of membership differently. It’s providing distinctive access and improving the ways we serve them. With these deep connections, it’s no surprise that time and again our consumers choose us. The results prove this vision with members on our apps spending nearly triple what others spend on NIKE.com. Through Consumer Direct, we are elevating our concept of membership…

Thanks, Mark and Trevor, and hello, everyone, on the call. Reflecting on our financial performance in fiscal year ‘17, I’d like to focus on three key themes that serve as important context going forward. First, the more closely we connect the NIKE brand to consumers in the marketplace, the stronger our growth. In fiscal year 2017, our DTC businesses grew 18% on a currency neutral basis, led by NIKE.com, and our NIKE branded experiences with partners also grew at a rate that’s far outpaced less differentiated multi-brand wholesale distribution. Second, we continue to deliver strong growth internationally and we have even greater potential for growth ahead. International markets currently represent roughly 55% of our portfolio and grew at a double-digit rate in aggregate in fiscal year 2017. While NIKE is the leading brand in fast growing developing markets around the world including China, current per capita spend on NIKE in those markets is still less than one-tenth of the per capita spend on NIKE in more developed markets. Over time, macroeconomic drivers and consumers expanding passion for sport will create even greater capacity for the NIKE brand to grow in those markets. Third, we continue to demonstrate our ability to manage all of the operating levers within our portfolio to deliver sustainable, profitable growth under a wide range of circumstances. In fiscal year ‘17, we delivered 16% growth in earnings per share, despite significant geopolitical and FX headwinds, and a rapidly evolving competitive and promotional marketplace. These themes reinforce why we are so aggressively executing on and we are so excited about the potential long-term financial impacts of our new Consumer Direct Offense. First, take 2X innovation. Innovation fuels growth. We have doubled our investment in innovation over the past three years and we’re now beginning to see the outsized…

[Operator Instructions] Your first question is from Kate McShane from Citi.

Hi. Thank you. Corrina Van Der Ghinst on for Kate McShane. Thanks for taking our questions. Maybe you could just start off with the -- more detail on the pilot that you guys are doing at Amazon. Do you guys have any color in terms of the timing of the launch, the segmentation focus that you guys are kind of aiming for in terms of price points, are they going to be more comparable to mid-tier premiums, are you guys going to do any -- are you planning on doing any exclusives and just in terms of the timing of why now?

Okay. Sure. Let me give you some perspective on how we’re looking at our Amazon partnership. First of all, I would start by saying that our overall goal is to elevate the consumer experience by better segmenting and differentiating all of our channels. Just as a backdrop, that’s foundational for NIKE. Every partner we have ultimately requires a specific approach and in other parts of the world, as I mentioned in my remarks, we’re executing with e-commerce platforms like TMall and Zalando. We’ve been doing that for over the past five years. With Amazon in the U.S., we’re running a pilot that begins with a small product assortment across footwear, Apparel and accessories and what’s most important to us is that we have the opportunity to elevate how the NIKE Brand is presented on the Amazon platform, and that includes the quality of the product information, and of course, providing a simple experience for the consumer. So we’re really looking forward to seeing how this pilot combines, ultimately the convenience that Amazon is well known for with NIKE’s brand and product power.

Yeah. And I’ll just add a couple things around the merchandising strategy. I think one of the things that we have been able to do over many years is really just execute a merchandising strategy that really delivers against a wide range of consumers really across the marketplace. So we’ve always been very thoughtful around how we segment and differentiate with our partners, ensuring that they have the right assortment that allows them to best serve the consumers with the right products and we will continue to do that certainly with this Amazon partnership. As Mark talked about, it is really a small pilot and it’s just a start, and obviously, as we continue to work with them we will -- and we see success then we’ll continue to think about how we scale it.

Okay. Great. Thank you. And then just my second question, it looks like North American and European footwear both accelerated in the quarter, but Apparel decelerated on a sequential basis. Can you kind of walk us through what you’re seeing in those categories and kind of your expectations for the next couple of quarters in terms of how those are progressing? And then if you could provide some commentary around the current U.S. wholesale environment by channel as you’re seeing it?

Okay. Yeah. Certainly. Yeah. I want to touch on the Apparel piece first. I think, one of the things that you’re looking at when you look at the Apparel. If you compare it against the prior year, you’re making comparisons when we certainly had the corporate America. So we are seeing, it’s just a tough comparison in Q4, and in North America we’re certainly seeing that because we were doing also there was the promotional activity in the marketplace. Around Apparel, we continue to feel very bullish about our Apparel business. Obviously, as we go into the first quarter, we’ve got the NBA partnership that we’re launching and we’re bringing some more innovative products. So we’re trying to be excited and positive about our Apparel business. But not only in North America, but if you go around the world, we’re seeing really, it go from strength to strength. So it really is just a great period.

Yeah. If I can just add a little bit of broader context too, it’s obviously no mystery that the U.S. marketplace is undergoing quite a transformation. The consumer is leading a lot of that change and we see that really as a great opportunity. For us, it always starts with product. That’s how the consumer ultimately casts their vote. And the good news, I think, from our perspective is that the product that we’ve got in the pipeline as we mentioned is as strong as it’s ever been across quite a spectrum. Men’s and Women’s, young, adult’s, retro, modern, performance and Sportswear, so feeling good about our complete offense on the product side. But the important point is that product isn’t enough. It’s about better services and experiences and that’s why we believe in this Consumer Direct Offense, I think, enabled by our Express Lane and then creating more disruption through digital. And then a lot of the great work we’re doing to scale some of the app-based commerce that we’re doing. So it’s a very dynamic environment there, but we feel really good, we’re doing what we need to operate a healthy business.

Thanks, Corrina. Operator, we’ll take the next question please.

The next question is from Omar Saad from Evercore ISI.

Thanks for taking my question, guys. I was hoping you could maybe help us understand, how you’re going to execute some of these really exciting Consumer Direct Offense strategies. The Express Lane, everything you’ve got going on the NIKE+ membership side and given that so much of your business is still in that kind of tradition channel points-of-sale and the distribution used there, how do you -- can you integrate some of these new strategies with that wholesale backdrop or is it really something that’s more refined and left to sit more predominantly in your DTC business?

Well, let me just start, Omar, with a little broader backdrop and these changes that we’re making around our Consumer Direct Offense are really about accelerating our growth potential. We’ve never really been about sustaining the status quo. It’s not a winning proposition. This consumer led offense for us is about getting sharper. It’s about getting more focused. And it’s about, as we’ve said, accelerating growth through the direct connections and then the elevated experiences in targeted channels and markets. So -- and as I’ve mentioned, it’s about innovation and storytelling, editing and focusing and we have a lot of opportunity there. We have to be better editors. I’m really confident that we are. We’re targeting some of the better innovation stories and doing a better job, I think of leveraging and scaling those across multiple categories and then we’ve got to move faster and that’s part of what this offense is all about. So we’re looking at going half -- taking half of the time out of design to shelf to the consumer and that’s a big step forward and we’re looking and continuing to scale that over time. So there’s growth if you look at it in all dimensions of our business and that includes channels as well. But as Andy mentioned, our focus is going to be pushing for the shift to direct where we have elevated experiences and that includes, as you mentioned, some of the app-based commerce that we’re working on. Some of the biggest growth that we’re seeing is in dotcom and some of the biggest growth on dotcom is really through mobile and the biggest growth on mobile is on app-based commerce, so incredibly exciting things happening there. So, overall, we’re incredibly energized, excited for ourselves, but also bringing our strategic partners and the rest of the industry along.

Yeah. Mark, a couple of things I’d just add to that, which is one of the things that we’ve certainly seen in the landscape is the cities are really the center of the action where you’re seeing really trends drive from the city. You’re also seeing the acceleration of expectations in those cities. So one of the things that we did with our Consumer Direct Offense is we have a real complete offense in the key cities. What we mean by that specifically is before we had brand teams and maybe marketplace teams. Now we have complete teams from product to digital to creative teams to membership teams all based in the city and this is a big shift. And this is where they are able to really use the knowledge that they get around the trends in the marketplace to drive that connection with the Express Lane to create specific products to ensure that we could drive the business not only in that city but really across the market. So for us it’s a very, very important piece. I think the other part that we did with the reorganization is we really put categories, design, products and merchandise all together as a full unit and their job is to ensure that we create the most innovative products and concepts that gets driven all the way through the market and then also we combined DTC with our digital organization. So now they’re one unit and so we have a really a one way that the consumer wants to come through the journey of a direct connection with the brand, we’re able to now serve them both physically and digitally. So we’re super excited about this and it really does create an incredible opportunity for us to drive growth.

That’s helpful. And then a quick follow up on the NIKE+ membership, sounds like that’s really starting to accelerate. Can you give us some color what you’re learning about how those NIKE+ members behave relative to just an ordinary customer and you also mention, I think, you’re going to accelerate some of the features and benefits of that program?

Yeah. Thanks for that. I mean, we’ve really seen just great, really great progress with NIKE+, both the sneakers app. What we’ve certainly seen is that they triple that they -- spend three times as much members on the apps versus those who just come through as sort of an everyday consumer. So membership really has tremendous benefits for us and from a business perspective and we are driving that commercially. We will also be expanding that really across into Western Europe, as well as in China and Japan, because it has predominately been within North America and that’s really just the start. I mean, we see a tremendous opportunity here and like I mentioned in the opening remarks, consumers expect more from us around membership and we have a lot more coming. So we couldn’t be more excited as the months go ahead. So stay tuned. It’s going to be fun.

Thanks, Omar. Operator, we’ll take the next…

Thanks. Good luck.

Thanks. We will take the next question please, operator.

The next question is from Bob Drbul from Guggenheim.

Hi. Good evening.

Hi, Bob.

I guess the first question that I have is around the three new platforms when you look at some of the bigger platforms and the more recent platforms prior to these, they ramped pretty quickly, I think, achieving a $1 billion faster and faster. Do you have any expectation on how quickly some of these can get to the scale you’re talking about in the next few years?

Yeah. It’s a great question, Bob. This is Andy. In the past you’ve seen platforms ranging from Free to Lunar to Flyknit. Start with a bit of a ceding based approach as we assessed consumer demand and we took the exact same approach with the Air VaporMax and the ZoomX platform, which was part of the Breaking2 initiative, which is start with a healthy amount of supply, but get a read for consumer demand and as we said, those products sold out within hours in multiple color ways. And so we, much like some of the most compelling innovations we’ve launched in the past, you’ll see us ramping those up or scaling those pretty significantly and that’s not just the same styles that we launch, but taking the actual innovation, the Air and the ZoomX cushioning system across price points and frankly across categories.

Yeah. I have to say, I love how the CFO jumps in on the product questions. Let me just quickly add that the focus on scaling and leveraging platforms is a big focus for us, and one of the things it’s going to drive growth, and one of the things that this new organization, I think, is going to enable editing and focusing on those biggest opportunities to scale in the innovation arena is absolutely critical. Air VaporMax is an incredible opportunity, as we’ve seen, not only in performance, but in style. It’s bringing those two worlds together and obviously the consumers’ responded very well there. A lot of excitement around ZoomX, as I talked about and where that can go. We’re just seeing the very frontend. I’ve talked about React. We’re just starting to come to market with some React products and that’s got massive potential, and there’s frankly a couple of others that have huge scale potential that I did not mention and I probably won’t go any further right now. But that we’re really excited about. And then we have Flyknit, which getting outside of footwear for a minute and looking at Flyknit’s potential to scale in Apparel is tremendous. Some real performance breakthroughs there that also combine innovation and style. I know I say this, but honestly, I’ve never felt as energized by what we have from an innovation standpoint coming in the pipeline and that’s why we’re so confident.

Got it. And then could I just ask like a couple of quick questions on the Amazon announcement? Is -- when you think about opening Amazon Direct, does that change your view on the NIKE 2020 targets of your DTC and your NIKE.com to $16 billion and $7 billion and is it a global pilot and will Jordan product be included in there?

It’s -- like we said, right now, it’s really a small pilot and we have a very tailored assortment for Amazon, so that we can actually learn as we go through this. In terms of looking forward, obviously, we have tremendous plans to continue to grow our NIKE.com business and what we talked is we’re rolling out certainly the apps, not only around the world, but also accelerating the work that we’re doing on that. So you can expect that to continue to grow at a very strong pace. So we’re not giving any further guidance at this point in time, but we certainly feel confident about the growth that we’re seeing and it’s really is part of our Triple Double Strategy. And so the Amazon piece is just one element of how we serve the broader market by making sure that we are serving consumers wherever they choose to shop and making sure that that’s through our doors, through our wholesale partners, as well as through platforms. So we’re really looking to make sure we serve the consumer in the appropriate way.

And we expect the digital commerce platforms to be a bigger part of the picture going forward not just here in the U.S., but around the world. We’ve mentioned Zalando and TMall, but that’s going to be a bigger part of the picture for us.

Great. Thanks very much. Good luck.

All right. Thanks, Bob. Operator, we’ll take the next question, please.

The next question is from Jim Duffy from Stifel.

Thank you. Hello, everyone.

Hi, Jim.

Mark, my question is for you around efforts to compress a product timeline and speed time to market to improve responsiveness. What are the steps in the product development cycle that offer the most opportunity for time savings, is it more on the design and pre-production side or is it more related to manufacturing logistics?

Yeah. That’s a good question. And really -- the answer really is there’s opportunity in every segment of the product creation process through the supply chain, part of it is in better planning, part of it is in better editing of the product itself and also the product line in general. But everything from rapid prototyping on the very frontend, all the way through some of the modernization techniques in automation that we’re pioneering with partners like Flex, HP, for example, are going to be critical factors there. But part of this is really staging, the innovation, tooling related, making sure that some of the more time intensive parts of the process or that’s where we apply the innovation to cut those timelines down tremendously. And we’ve already talked about the three different dimensions of Express Lane. I touched on update, fulfill and then create. And across those three dimensions, there’s tremendous opportunity. Update and fulfill is more straightforward because that’s existing product that we can rally behind quickly, and then create is all about accelerating the whole process from end to end. But again, I’m really excited about some real step change innovation that the Express Lane work is going to enable and also our advance product creation center here in Beaverton with our key manufacturing innovation partners.

As a follow-up to that, can you maybe build on that with comments about opportunities to use data to better anticipate consumer demand and how that dovetails with the speed to market initiatives?

Yeah. That’s a great question. In that zone, one of the things, which is a huge, let’s say, benefit of the consumer direct strategy is to have better knowledge of the consumers. It’s one of the things that we continue to work on, which is to be able to have a better read on the demand from the consumers and then turn that demand directly into how we come back and give them the person they actually want. The part about membership is that we also get to know who actually wants what and what they desire so that’s part of the vision that we’re working through, which is why data is fundamentally important to understanding the consumer, who’s buying, why they’re buying, what they want, what is trending and how we can then put all that information back into our product creation cycle quickly to then bring, so we can scale against those opportunities, so it’s a key piece.

That’s -- actually this is a huge part of NIKE’s future, and frankly, many, many other companies is capturing and interpreting that data, turning it into insights, personalizing services, experience, and of course, products. And that’s going to happen at the local level and then we’re going to aggregate that more effectively at the Inc. level.

Thank you, Jim.

Thank you very much.

Thanks, Jim. Operator, we’ll take one last question.

The last question is from Matthew McClintock from Barclays.

Yes. Good afternoon, everyone. Thanks for squeezing me in.

Hi.

On brand Jordan, I was actually wondering if we could talk about brand Jordan, continued strong growth there, $3 billion of revenue, as you look into fiscal ‘18, what makes you most excited about the opportunities for that brand specifically and then can you talk more about your efforts to transcend the brand beyond its basketball roots and into other product categories such as Apparel? Thanks.

Yeah. Certainly. Obviously we continue to be truly excited about the opportunity of brand Jordan and how brand Jordan continues to perform. So it had a great year and we envision that it will have a great year next year again. One of the areas that we continue to work on is expanding the different consumer groups that we connect with. One clear opportunity for us is certainly the women’s business, which we see tremendous passion for the brand coming through there, so we will grow the business there in addition to continuing to drive its connection with Basketball, so the NBA partnership actually allows us to do some things with brand Jordan. So we’re very, very excited there. And we will continue to actually sign more athletes and teams against that business. So we recently did UNC Football, so all of those are really just examples of how we’re expanding the actual positioning of that brand to tap into new consumer groups.

$3 billion is an impressive milestone for Jordan, but the international potential for growth is, as we mentioned is really significant going forward. Apparel is still underpenetrated and then as Trevor mentioned, categories beyond Basketball and Sportswear are wide open. The Jordan brand has a huge base, a huge following not just here in the U.S. but around the world, so we’re excited about capitalizing on that and taking the brand to more people around the world. So this is a huge growth opportunity for NIKE going forward.

Yeah. I didn’t mention Apparel and Apparel also continues to grow at a tremendous rate. So again, just great opportunity around that portfolio and we’re absolutely committed to seeing it grow around the world.

It’s also a place where we can leverage NIKE technology and NIKE innovation in a new way. We can interpret that through the Jordan lens and that creates more opportunity for us as well.

Thanks a lot.

All right. Well, thank you, Matt. I think that’s all the time we have for today. Thank you all for joining us and we’ll speak with you next quarter. Take care.

This concludes today’s conference call. You may now disconnect.