Nike Inc (NKE)
Return on total capital
| May 31, 2025 | May 31, 2024 | May 31, 2023 | May 31, 2022 | May 31, 2021 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | — | 6,311,000 | 5,915,000 | 6,675,000 | 6,937,000 |
| Long-term debt | US$ in thousands | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 13,213,000 | 14,430,000 | 14,004,000 | 15,281,000 | 12,767,000 |
| Return on total capital | 0.00% | 43.74% | 42.24% | 43.68% | 54.34% |
May 31, 2025 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $—K ÷ ($—K + $13,213,000K)
= 0.00%
The analysis of Nike Inc.'s return on total capital over the period from May 31, 2021, to May 31, 2025, reveals notable trends and fluctuations. As of May 31, 2021, the return on total capital stood at 54.34%, indicating a strong efficiency in generating earnings from the company's capital investments for that fiscal year.
Subsequently, there was a decline in this ratio to 43.68% by May 31, 2022, which reflects a decrease in the company's ability to utilize its total capital effectively, possibly due to increased costs, operational challenges, or changes in asset utilization. The downward trend persisted into 2023, with the ratio diminishing further to 42.24%, suggesting a continued decline in the company's efficiency metrics.
In the following year, May 31, 2024, the return on total capital experienced a modest recovery to 43.74%, marginally surpassing the previous year's figure, which may indicate some improvement in operational performance or capital efficiency.
However, the projection or data for May 31, 2025, indicates a return of 0.00%, which could imply significant changes such as a reporting anomaly, restructuring activities, or other extraordinary events affecting cost and capital structure. This abrupt change signifies an unusual scenario that warrants further investigation for contextual understanding.
Overall, the trend demonstrates a notable decline in Nike’s return on total capital from a high of over 54% in 2021 to virtually zero in 2025, signifying a potential shift in operational performance or capital utilization efficiency over this period.
Peer comparison
May 31, 2025