Document and Entity Information

3 Months Ended

Aug. 31, 2015

Oct. 1, 2015

Class A Convertible Common Stock

Oct. 1, 2015

Class B Common Stock

Document Type

10-Q

Amendment Flag

false

Document Period End Date

Aug. 31, 2015

Document Fiscal Year Focus

2016

Document Fiscal Period Focus

Q1

Trading Symbol

NKE

Entity Registrant Name

NIKE INC

Entity Central Index Key

0000320187

Current Fiscal Year End Date

--05-31

Entity Well-known Seasoned Issuer

Yes

Entity Current Reporting Status

Yes

Entity Voluntary Filers

No

Entity Filer Category

Large Accelerated Filer

Entity Common Stock Shares Outstanding (In Shares)

177,457,876

674,735,884

Unaudited Condensed Consolidated Balance Sheets (USD $)

In Millions, unless otherwise specified

Aug. 31, 2015

May 31, 2015

Current assets:

Cash and equivalents (Note 4)

$ 3,246

$ 3,852

Short-term investments (Note 4)

2,162

2,072

Accounts receivable, net

3,288

3,358

Inventories (Note 2)

4,414

4,337

Deferred income taxes (Note 6)

377

389

Prepaid expenses and other current assets (Notes 4 and 9)

1,751

1,968

Total current assets

15,238

15,976

Property, plant and equipment, net

3,112

3,011

Identifiable intangible assets, net

281

Goodwill

131

Deferred income taxes and other assets (Notes 4, 6 and Note 9)

2,004

2,201

TOTAL ASSETS

20,766

21,600

Current liabilities:

Current portion of long-term debt (Note 4)

106

107

Notes payable (Note 4)

23

74

Accounts payable

1,933

2,131

Accrued liabilities (Notes 3, 4 and 9)

3,139

3,951

Income taxes payable (Note 6)

75

71

Total current liabilities

5,276

6,334

Long-term debt (Note 4)

1,079

Deferred income taxes and other liabilities (Notes 4, 6 and 9)

1,517

1,480

Commitments and contingencies (Note 12)

Redeemable preferred stock

0

Shareholders’ equity:

Capital in excess of stated value

7,029

6,773

Accumulated other comprehensive income (Note 10)

833

1,246

Retained earnings

5,029

4,685

Total shareholders’ equity

12,894

12,707

TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY

20,766

21,600

Class A Convertible Common Stock

Shareholders’ equity:

Common stock at stated value

0

Class B Common Stock

Shareholders’ equity:

Common stock at stated value

$ 3

Unaudited Condensed Consolidated Balance Sheets (Parenthetical)

In Millions, unless otherwise specified

Aug. 31, 2015

May 31, 2015

Class A Convertible Common Stock

Common Stock, shares outstanding

177

178

Class B Common Stock

Common Stock, shares outstanding

677

679

Unaudited Condensed Consolidated Statements Of Income (USD $)

In Millions, except Per Share data, unless otherwise specified

3 Months Ended

Aug. 31, 2015

Aug. 31, 2014

Income Statement [Abstract]

Revenues

$ 8,414

$ 7,982

Cost of sales

4,419

4,261

Gross profit

3,995

3,721

Demand creation expense

832

897

Operating overhead expense

1,745

1,583

Total selling and administrative expense

2,577

2,480

Interest expense (income), net (Note 4)

4

9

Other (income) expense, net (Note 9)

(31)

3

Income before income taxes

1,445

1,229

Income tax expense (Note 6)

266

267

NET INCOME

$ 1,179

$ 962

Earnings per common share:

Basic (in dollars per share)

$ 1.38

$ 1.11

Diluted (in dollars per share)

$ 1.34

$ 1.09

Dividends declared per common share (in dollars per share)

$ 0.28

$ 0.24

Unaudited Condensed Consolidated Statements of Comprehensive Income (USD $)

In Millions, unless otherwise specified

3 Months Ended

Aug. 31, 2015

Aug. 31, 2014

Statement of Comprehensive Income [Abstract]

Net income

$ 1,179

$ 962

Other comprehensive income (loss), net of tax:

Change in net foreign currency translation adjustment

(81)

2

Change in net gains (losses) on cash flow hedges

(329)

135

Change in net gains (losses) on other

(3)

2

Total other comprehensive income (loss), net of tax

(413)

139

TOTAL COMPREHENSIVE INCOME

$ 766

$ 1,101

Unaudited Condensed Consolidated Statements of Cash Flows (USD $)

In Millions, unless otherwise specified

3 Months Ended

Aug. 31, 2015

Aug. 31, 2014

Cash provided by operations:

Net income

$ 1,179

$ 962

Income charges (credits) not affecting cash:

Depreciation

154

147

Deferred income taxes

(31)

35

Stock-based compensation (Note 7)

54

43

Amortization and other

11

8

Net foreign currency adjustments

32

53

Changes in certain working capital components and other assets and liabilities:

Decrease (increase) in accounts receivable

52

(203)

(Increase) in inventories

(100)

(111)

(Increase) in prepaid expenses and other current assets

(73)

0

(Decrease) in accounts payable, accrued liabilities and income taxes payable

(787)

(251)

Cash provided by operations

491

683

Cash (used) provided by investing activities:

Purchases of short-term investments

(1,188)

(1,296)

Maturities of short-term investments

721

1,074

Sales of short-term investments

450

762

Investments in reverse repurchase agreements

(50)

0

Additions to property, plant and equipment

(327)

(262)

Disposals of property, plant and equipment

9

2

Cash (used) provided by investing activities

(385)

280

Cash used by financing activities:

Long-term debt payments, including current portion

(1)

(2)

(Decrease) in notes payable

(48)

(17)

Payments on capital lease obligations

0

(6)

Proceeds from exercise of stock options and other stock issuances

128

127

Excess tax benefits from share-based payment arrangements

75

44

Repurchase of common stock

(588)

(819)

Dividends — common and preferred

(240)

(209)

Cash used by financing activities

(674)

(882)

Effect of exchange rate changes on cash and equivalents

(38)

2

Net (decrease) increase in cash and equivalents

(606)

83

Cash and equivalents, beginning of period

3,852

2,220

CASH AND EQUIVALENTS, END OF PERIOD

3,246

2,303

Supplemental disclosure of cash flow information:

Non-cash additions to property, plant and equipment

152

125

Dividends declared and not paid

$ 239

$ 207

Summary of Significant Accounting Policies

NOTE 1 — Summary of Significant Accounting Policies

Basis of Presentation

The Unaudited Condensed Consolidated Financial Statements include the accounts of NIKE, Inc. and its subsidiaries (the "Company") and reflect all normal adjustments which are, in the opinion of management, necessary for a fair statement of the results of operations for the interim period. The year-end Condensed Consolidated Balance Sheet data as of May 31, 2015 was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America (“U.S. GAAP”). The interim financial information and notes thereto should be read in conjunction with the Company’s latest Annual Report on Form 10-K. The results of operations for the three months ended August 31, 2015 are not necessarily indicative of results to be expected for the entire year.

Reclassifications

Certain prior year amounts have been reclassified to conform to fiscal 2016 presentation.

Revisions

During the third quarter of fiscal 2015, management determined it had incorrectly reflected unrealized gains and losses from re-measurement of non-functional currency intercompany balances between certain of its foreign wholly-owned subsidiaries in its Consolidated Statements of Cash Flows. These unrealized gains and losses should have been classified as non-cash reconciling items from Net income to Cash provided by operations, but were instead reported on the Effect of exchange rate changes on cash and equivalents line of the Consolidated Statements of Cash Flows. This resulted in an understatement of Cash provided by operations reported on the Consolidated Statements of Cash Flows for certain prior periods; there was no impact for any period to Net increase (decrease) in cash and equivalents reported on the Consolidated Statements of Cash Flows, or Cash and equivalents reported on the Consolidated Statements of Cash Flows and Balance Sheets. The Company assessed the materiality of the misclassifications on prior periods' financial statements in accordance with SEC Staff Accounting Bulletin ("SAB") No. 99, Materiality, codified in Accounting Standards Codification ("ASC") 250, Presentation of Financial Statements and concluded that these misstatements were not material to any prior annual or interim periods. Accordingly, in accordance with ASC 250 (SAB No. 108, Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements), the amounts have been revised in the applicable Consolidated Statements of Cash Flows. For the three and six months ended August 31, 2014 and November 30, 2014 of fiscal 2015, the revisions increased Cash provided by operations and decreased Effect of exchange rate changes on cash and equivalents by $95 million and $312 million, respectively. These amounts have been reflected in the table below. As part of the revision to the Consolidated Statements of Cash Flows, the Company has updated its presentation to separately report Net foreign currency adjustments, which was previously included within Amortization and other.



	NIKE, Inc. Unaudited Condensed Consolidated Statements of Cash Flows
	Three Months Ended August 31, 2014								Six Months Ended November 30, 2014
(In millions)	As Reported			Adjustment			As Revised		As Reported			Adjustment			As Revised
Cash provided by operations:
Net income	$	962		$	—		$	962	$	1,617		$	—		$	1,617
Income charges (credits) not affecting cash:
Amortization and other	(34		)	42			8		(54		)	69			15
Net foreign currency adjustments	—			53			53		—			243			243
Cash provided by operations	588			95			683		1,235			312			1,547
Effect of exchange rate changes on cash and equivalents	97			(95		)	2		288			(312		)	(24		)
Net increase (decrease) in cash and equivalents	83			—			83		53			—			53
Cash and equivalents, beginning of period	2,220			—			2,220		2,220			—			2,220
CASH AND EQUIVALENTS, END OF PERIOD	$	2,303		$	—		$	2,303	$	2,273		$	—		$	2,273

Recently Issued Accounting Standards

In May 2014, the Financial Accounting Standards Board ("FASB") issued an accounting standards update that replaces existing revenue recognition guidance. The updated guidance requires companies to recognize revenue in a way that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In addition, the new standard requires that reporting companies disclose the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. Based on the FASB's decision in July 2015 to defer the effective date and to allow more flexibility with implementation, the Company anticipates the new standard will be effective for the Company beginning June 1, 2018. The new standard is required to be applied retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of initially applying it recognized at the date of initial application. The Company has not yet selected a transition method and is currently evaluating the effect the guidance will have on the Consolidated Financial Statements.

Inventories

NOTE 2 — Inventories

Inventory balances of $4,414 million and $4,337 million at August 31, 2015 and May 31, 2015, respectively, were substantially all finished goods.

Accrued Liabilities

NOTE 3 — Accrued Liabilities

Accrued liabilities included the following:



	As of August 31,		As of May 31,
(In millions)	2015		2015
Compensation and benefits, excluding taxes	$	672	$	997
Collateral received from counterparties to hedging instruments	468		968
Endorsement compensation	393		388
Dividends payable	239		240
Taxes other than income taxes	218		174
Import and logistics costs	173		207
Advertising and marketing	126		117
Fair value of derivatives	118		162
Other⁽¹⁾	732		698
TOTAL ACCRUED LIABILITIES	$	3,139	$	3,951


(1)	Other consists of various accrued expenses with no individual item accounting for more than 5% of the total Accrued liabilities balance at August 31, 2015 and May 31, 2015.

Fair Value Measurements

NOTE 4 — Fair Value Measurements

The Company measures certain financial assets and liabilities at fair value on a recurring basis, including derivatives and available-for-sale securities. Fair value is the price the Company would receive to sell an asset or pay to transfer a liability in an orderly transaction with a market participant at the measurement date. The Company uses the three-level hierarchy established by the FASB that prioritizes fair value measurements based on the types of inputs used for the various valuation techniques (market approach, income approach and cost approach).

The levels of the fair value hierarchy are described below:


•	Level 1: Quoted prices in active markets for identical assets or liabilities.


•	Level 2: Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly; these include quoted prices for similar assets or liabilities in active markets and quoted prices for identical assets or liabilities in markets that are not active.


•	Level 3: Unobservable inputs for which there is little or no market data available, which require the reporting entity to develop its own assumptions.

The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. Financial assets and liabilities are classified in their entirety based on the most conservative level of input that is significant to the fair value measurement.

Pricing vendors are utilized for certain Level 1 and Level 2 investments. These vendors either provide a quoted market price in an active market or use observable inputs without applying significant adjustments in their pricing. Observable inputs include broker quotes, interest rates and yield curves observable at commonly quoted intervals, volatilities and credit risks. The Company’s fair value processes include controls that are designed to ensure appropriate fair values are recorded. These controls include a comparison of fair values to another independent pricing vendor.

The following tables present information about the Company’s financial assets measured at fair value on a recurring basis as of August 31, 2015 and May 31, 2015, and indicate the level in the fair value hierarchy in which the Company classifies the fair value measurement.



	As of August 31, 2015
(In millions)	Assets at Fair Value		Cash and Equivalents		Short-term Investments		Other Long-term Assets
Cash	$	746	$	746	$	—	$	—
Level 1:
U.S. Treasury securities	1,050		275		775		—
Level 2:
Time deposits	616		616		—		—
U.S. Agency securities	872		15		857		—
Commercial paper and bonds	685		155		530		—
Money market funds	1,439		1,439		—		—
Total Level 2:	3,612		2,225		1,387		—
Level 3:
Non-marketable preferred stock	9		—		—		9
TOTAL	$	5,417	$	3,246	$	2,162	$	9



	As of May 31, 2015
(In millions)	Assets at Fair Value		Cash and Equivalents		Short-term Investments		Other Long-term Assets
Cash	$	615	$	615	$	—	$	—
Level 1:
U.S. Treasury securities	869		225		644		—
Level 2:
Time deposits	684		684		—		—
U.S. Agency securities	976		110		866		—
Commercial paper and bonds	914		352		562		—
Money market funds	1,866		1,866		—		—
Total Level 2:	4,440		3,012		1,428		—
Level 3:
Non-marketable preferred stock	8		—		—		8
TOTAL	$	5,932	$	3,852	$	2,072	$	8

The Company elects to record the gross assets and liabilities of its derivative financial instruments on the Unaudited Condensed Consolidated Balance Sheets. The Company’s derivative financial instruments are subject to master netting arrangements that allow for the offset of assets and liabilities in the event of default or early termination of the contract. Any amounts of cash collateral received or posted related to these instruments associated with the Company's credit related contingent features are recorded in Cash and equivalents and Accrued liabilities, the latter of which would further offset against the Company’s derivative asset balance (refer to Note 9 — Risk Management and Derivatives). Cash collateral received or posted related to the Company's credit related contingent features is presented in the Cash provided by operations component of the Unaudited Condensed Consolidated Statement of Cash Flows. Any amounts of non-cash collateral received, such as securities, are not recorded on the Unaudited Condensed Consolidated Balance Sheets pursuant to the accounting standards for non-cash collateral received.

The following tables present information about the Company’s derivative assets and liabilities measured at fair value on a recurring basis as of August 31, 2015 and May 31, 2015, and indicate the level in the fair value hierarchy in which the Company classifies the fair value measurement.



	As of August 31, 2015
	Derivative Assets						Derivative Liabilities
(In millions)	Assets at Fair Value		Other Current Assets		Other Long-term Assets		Liabilities at Fair Value		Accrued Liabilities		Other Long-term Liabilities
Level 2:
Foreign exchange forwards and options⁽¹⁾	$	1,070	$	771	$	299	$	135	$	116	$	19
Embedded derivatives	8		4		4		12		2		10
Interest rate swaps⁽²⁾	76		76		—		—		—		—
TOTAL	$	1,154	$	851	$	303	$	147	$	118	$	29

(1)

If the foreign exchange derivative instruments had been netted on the Unaudited Condensed Consolidated Balance Sheets, the asset and liability positions each would have been reduced by $135 million as of August 31, 2015. As of that date, the Company had received $417 million of cash collateral from various counterparties related to these foreign exchange derivative instruments. No amount of collateral was posted on the Company’s derivative liability balance as of August 31, 2015.


(2)	As of August 31, 2015, the Company had received $51 million of cash collateral related to its interest rate swaps.



	As of May 31, 2015
	Derivative Assets						Derivative Liabilities
(In millions)	Assets at Fair Value		Other Current Assets		Other Long-term Assets		Liabilities at Fair Value		Accrued Liabilities		Other Long-term Liabilities
Level 2:
Foreign exchange forwards and options⁽¹⁾	$	1,554	$	1,034	$	520	$	164	$	160	$	4
Embedded derivatives	7		2		5		11		2		9
Interest rate swaps⁽²⁾	78		78		—		—		—		—
TOTAL	$	1,639	$	1,114	$	525	$	175	$	162	$	13

(1)

If the foreign exchange derivative instruments had been netted on the Consolidated Balance Sheets, the asset and liability positions each would have been reduced by $161 million as of May 31, 2015. As of that date, the Company had received $900 million of cash collateral and $74 million of securities from various counterparties related to these foreign exchange derivative instruments. No amount of collateral was posted on the Company’s derivative liability balance as of May 31, 2015.


(2)	As of May 31, 2015, the Company had received $68 million of cash collateral related to its interest rate swaps.

Available-for-sale securities comprise investments in U.S. Treasury and Agency securities, money market funds, corporate commercial paper and bonds. These securities are valued using market prices on both active markets (Level 1) and less active markets (Level 2). The gross realized gains and losses on sales of available-for-sale securities were immaterial for the three months ended August 31, 2015 and 2014. Unrealized gains and losses on available-for-sale securities included in Accumulated other comprehensive income were immaterial as of August 31, 2015 and May 31, 2015.

The Company regularly reviews its available-for-sale securities for other-than-temporary impairment. For the three months ended August 31, 2015 the Company did not consider any of its securities to be other-than-temporarily impaired and, accordingly, did not recognize any impairment losses.

As of August 31, 2015, the Company held $1,905 million of available-for-sale securities with maturity dates within one year and $257 million with maturity dates over one year and less than five years within Short-term investments on the Unaudited Condensed Consolidated Balance Sheets.

Included in Interest expense (income), net for each of the three months ended August 31, 2015 and 2014 was interest income related to the Company's available-for-sale securities of $2 million and $1 million, respectively.

The Company’s Level 3 assets comprise investments in certain non-marketable preferred stock. These Level 3 investments are an immaterial portion of the Company's portfolio. Changes in Level 3 investment assets were immaterial during the three months ended August 31, 2015 and the fiscal year ended May 31, 2015.

Derivative financial instruments include foreign exchange forwards and options, embedded derivatives and interest rate swaps. Refer to Note 9 — Risk Management and Derivatives for additional detail.

No transfers among the levels within the fair value hierarchy occurred during the three months ended August 31, 2015.

As of August 31, 2015 and May 31, 2015, the Company had no assets or liabilities that were required to be measured at fair value on a non-recurring basis.

Financial Assets and Liabilities Not Recorded at Fair Value

The Company’s long-term debt is recorded at adjusted cost, net of amortized premiums and discounts and interest rate swap fair value adjustments. The fair value of long-term debt is estimated based upon quoted prices for similar instruments or quoted prices for identical instruments in inactive markets (Level 2). The fair value of the Company’s long-term debt, including the current portion, was approximately $1,130 million at August 31, 2015 and $1,160 million at May 31, 2015.

The carrying amounts reflected on the Unaudited Condensed Consolidated Balance Sheets for Notes payable approximate fair value.

At August 31, 2015 and May 31, 2015, the Company had $200 million and $150 million, respectively, of outstanding receivables related to its investments in reverse repurchase agreements recorded within Prepaid expenses and other current assets on the Unaudited Condensed Consolidated Balance Sheets. The carrying amount of these agreements approximates their fair value based upon observable inputs other than quoted prices (Level 2). The reverse repurchase agreements are fully collateralized.

Short-Term Borrowings and Credit Lines

NOTE 5 — Short-Term Borrowings and Credit Lines

There have been no significant changes to the short-term borrowings and credit lines reported in the Company’s Annual Report on Form 10-K for the fiscal year ended May 31, 2015, except for the following:

On August 28, 2015, the Company entered into a committed credit facility agreement with a syndicate of banks which provides for up to $2 billion of borrowings. The facility matures August 28, 2020, with a one year extension option prior to any anniversary of the closing date, provided that in no event shall it extend beyond August 28, 2022. Based on the Company’s current long-term senior unsecured debt ratings of AA- and A1 from Standard and Poor’s Corporation and Moody’s Investor Services, respectively, the interest rate charged on any outstanding borrowings would be the prevailing LIBOR plus 0.455%. The facility fee is 0.045% of the total commitment. Under this committed credit facility, the Company must maintain certain financial ratios, among other things, with which the Company was in compliance at August 31, 2015. This facility replaces the prior $1 billion credit facility agreement entered into on November 1, 2011, which would have matured November 1, 2017. As of and for the period ended August 31, 2015, no amounts were outstanding under either committed credit facility.

Income Taxes

NOTE 6 — Income Taxes

The effective tax rate was 18.4% and 21.7% for the three month periods ended August 31, 2015 and 2014, respectively. The decrease in the Company’s effective tax rate was primarily due to an increase in the proportion of earnings from operations outside of the United States, which are generally subject to a lower tax rate, as well as certain discrete items recognized in the quarter.

As of August 31, 2015, total gross unrecognized tax benefits, excluding related interest and penalties, were $460 million, $258 million of which would affect the Company’s effective tax rate if recognized in future periods. As of May 31, 2015, total gross unrecognized tax benefits, excluding related interest and penalties, were $438 million. The liability for payment of interest and penalties increased $13 million during the three months ended August 31, 2015. As of August 31, 2015 and May 31, 2015, accrued interest and penalties related to uncertain tax positions were $177 million and $164 million, respectively (excluding federal benefit).

The Company incurs tax liabilities primarily in the United States, China and the Netherlands, as well as various other state and foreign jurisdictions. The Company is currently under audit by the U.S. Internal Revenue Service (IRS) for the 2013 and 2014 fiscal years. The Company has closed all U.S. federal income tax matters through fiscal 2012, with the exception of the validation of foreign tax credits utilized. As previously disclosed, the Company received a statutory notice of deficiency for fiscal 2011 proposing an increase in tax of $31 million, subject to interest, related to the foreign tax credit matter. This notice also reported a decrease in foreign tax credit carryovers for fiscal 2010 and 2011. The Company has contested this deficiency notice by filing a petition with the U.S. Tax Court in April 2015. The Company does not expect the outcome of this matter to have a material impact on the financial statements. No payments on the assessment would be required until the dispute is definitively resolved. Based on the information currently available, the Company does not anticipate a significant increase or decrease to its unrecognized tax benefits for this matter within the next 12 months.

The Company’s major foreign jurisdictions, China and the Netherlands, have concluded substantially all income tax matters through calendar 2005 and fiscal 2009, respectively. Although the timing of resolution of audits is not certain, the Company evaluates all domestic and foreign audit issues in the aggregate, along with the expiration of applicable statutes of limitations, and estimates that it is reasonably possible the total gross unrecognized tax benefits could decrease by up to $43 million within the next 12 months.

Common Stock and Stock-Based Compensation

NOTE 7 — Common Stock and Stock-Based Compensation

The authorized number of shares of Class A Common Stock, no par value, and Class B Common Stock, no par value, are 400 million and 2,400 million, respectively. Each share of Class A Common Stock is convertible into one share of Class B Common Stock. Voting rights of Class B Common Stock are limited in certain circumstances with respect to the election of directors. There are no differences in the dividend and liquidation preferences or participation rights of the Class A and Class B common shareholders.

The NIKE, Inc. Stock Incentive Plan (the "Stock Incentive Plan") provides for the issuance of up to 359 million previously unissued shares of Class B Common Stock in connection with stock options and other awards granted under the Stock Incentive Plan. The Stock Incentive Plan authorizes the grant of non-statutory stock options, incentive stock options, stock appreciation rights, restricted stock, restricted stock units and performance-based awards. The exercise price for stock options and stock appreciation rights may not be less than the fair market value of the underlying shares on the date of grant. A committee of the Board of Directors administers the Stock Incentive Plan. The committee has the authority to determine the employees to whom awards will be made, the amount of the awards and the other terms and conditions of the awards. Substantially all stock option grants outstanding under the Stock Incentive Plan are granted in the first quarter of each fiscal year, vest ratably over four years and expire 10 years from the date of grant.

In addition to the Stock Incentive Plan, the Company gives employees the right to purchase shares at a discount to the market price under employee stock purchase plans (“ESPPs”). Employees are eligible to participate through payroll deductions of up to 10% of their compensation. At the end of each six-month offering period, shares are purchased by the participants at 85% of the lower of the fair market value at the beginning or the end of the offering period.

The Company accounts for stock-based compensation by estimating the fair value of options granted under the Stock Incentive Plan and employees’ purchase rights under the ESPPs using the Black-Scholes option pricing model. The Company recognizes this fair value as Operating overhead expense over the vesting period using the straight-line method.

The following table summarizes the Company’s total stock-based compensation expense recognized in Operating overhead expense:



	Three Months Ended August 31,
(In millions)	2015		2014
Stock options⁽¹⁾	$	39	$	30
ESPPs	7		6
Restricted stock	8		7
TOTAL STOCK-BASED COMPENSATION EXPENSE	$	54	$	43


(1)	Expense for stock options includes the expense associated with stock appreciation rights. Accelerated stock option expense is recorded for employees eligible for accelerated stock option vesting upon retirement. Accelerated stock option expense for the three month periods ended August 31, 2015 and 2014 was $6 million and $4 million, respectively.

As of August 31, 2015, the Company had $377 million of unrecognized compensation costs from stock options, net of estimated forfeitures, to be recognized in Operating overhead expense over a weighted average remaining period of 2.7 years.

The weighted average fair value per share of the options granted during the three month periods ended August 31, 2015 and 2014, computed as of the grant date using the Black-Scholes pricing model, was $25.32 and $16.91, respectively. The weighted average assumptions used to estimate these fair values are as follows:



	Three Months Ended August 31,
	2015		2014
Dividend yield	1.0	%	1.2	%
Expected volatility	23.6	%	23.6	%
Weighted average expected life (in years)	5.8		5.8
Risk-free interest rate	1.7	%	1.7	%

The Company estimates the expected volatility based on the implied volatility in market traded options on the Company’s common stock with a term greater than one year, along with other factors. The weighted average expected life of options is based on an analysis of historical and expected future exercise patterns. The interest rate is based on the U.S. Treasury (constant maturity) risk-free rate in effect at the date of grant for periods corresponding with the expected term of the options.

Earnings Per Share

NOTE 8 — Earnings Per Share

The following is a reconciliation from basic earnings per common share to diluted earnings per common share. The computations of diluted earnings per common share excluded options to purchase an additional 10.2 million and 9.2 million shares of common stock outstanding for the three month periods ended August 31, 2015 and 2014, respectively, because the options were anti-dilutive.



	Three Months Ended August 31,
(In millions, except per share data)	2015		2014
Determination of shares:
Weighted average common shares outstanding	854.5		864.9
Assumed conversion of dilutive stock options and awards	22.8		21.3
DILUTED WEIGHTED AVERAGE COMMON SHARES OUTSTANDING	877.3		886.2

Earnings per common share:
Basic	$	1.38	$	1.11
Diluted	$	1.34	$	1.09

Risk Management and Derivatives

NOTE 9 — Risk Management and Derivatives

The Company is exposed to global market risks, including the effect of changes in foreign currency exchange rates and interest rates, and uses derivatives to manage financial exposures that occur in the normal course of business. The Company does not hold or issue derivatives for trading or speculative purposes.

The Company may elect to designate certain derivatives as hedging instruments under the accounting standards for derivatives and hedging. The Company formally documents all relationships between designated hedging instruments and hedged items as well as its risk management objectives and strategies for undertaking hedge transactions. This process includes linking all derivatives designated as hedges to either recognized assets or liabilities or forecasted transactions.

The majority of derivatives outstanding as of August 31, 2015 are designated as foreign currency cash flow hedges, primarily for Euro/U.S. Dollar, British Pound/Euro and Japanese Yen/U.S. Dollar currency pairs. All derivatives are recognized on the Unaudited Condensed Consolidated Balance Sheets at fair value and classified based on the instrument’s maturity date.

The following table presents the fair values of derivative instruments included within the Unaudited Condensed Consolidated Balance Sheets as of August 31, 2015 and May 31, 2015:



	Derivative Assets					Derivative Liabilities
(In millions)	Balance Sheet Location	August 31, 2015		May 31, 2015		Balance Sheet Location	August 31, 2015		May 31, 2015
Derivatives formally designated as hedging instruments:
Foreign exchange forwards and options	Prepaid expenses and other current assets	$	662	$	825	Accrued liabilities	$	90	$	140
Interest rate swaps	Prepaid expenses and other current assets	76		78		Accrued liabilities	—		—
Foreign exchange forwards and options	Deferred income taxes and other assets	298		520		Deferred income taxes and other liabilities	10		4
Total derivatives formally designated as hedging instruments		1,036		1,423			100		144
Derivatives not designated as hedging instruments:
Foreign exchange forwards and options	Prepaid expenses and other current assets	109		209		Accrued liabilities	26		20
Embedded derivatives	Prepaid expenses and other current assets	4		2		Accrued liabilities	2		2
Foreign exchange forwards and options	Deferred income taxes and other assets	1		—		Deferred income taxes and other liabilities	9		—
Embedded derivatives	Deferred income taxes and other assets	4		5		Deferred income taxes and other liabilities	10		9
Total derivatives not designated as hedging instruments		118		216			47		31
TOTAL DERIVATIVES		$	1,154	$	1,639		$	147	$	175

The following tables present the amounts affecting the Unaudited Condensed Consolidated Statements of Income for the three months ended August 31, 2015 and 2014:



(In millions)	Amount of Gain (Loss) Recognized in Other Comprehensive Income on Derivatives⁽¹⁾						Amount of Gain (Loss) Reclassified From Accumulated Other Comprehensive Income into Income⁽¹⁾
	Three Months Ended August 31,						Location of Gain (Loss) Reclassified From Accumulated Other Comprehensive Income into Income	Three Months Ended August 31,
	2015			2014				2015			2014
Derivatives designated as cash flow hedges:
Foreign exchange forwards and options	$	33		$	(38	)	Revenues	$	(43	)	$	(17	)
Foreign exchange forwards and options	(118		)	119			Cost of sales	160			(8		)
Foreign exchange forwards and options	(95		)	37			Other (income) expense, net	31			5
Interest rate swaps	—			—			Interest expense (income), net	—			—
Total designated cash flow hedges	$	(180	)	$	118			$	148		$	(20	)


(1)	For the three months ended August 31, 2015, the amounts recorded in Other (income) expense, net as a result of hedge ineffectiveness and the discontinuance of cash flow hedges because the forecasted transactions were no longer probable of occurring were immaterial.



	Amount of Gain (Loss) Recognized in Income on Derivatives						Location of Gain (Loss) Recognized in Income on Derivatives
	Three Months Ended August 31,
(In millions)	2015			2014
Derivatives designated as fair value hedges:
Interest rate swaps⁽¹⁾	$	1		$	1		Interest expense (income), net
Derivatives not designated as hedging instruments:
Foreign exchange forwards and options	(29		)	93			Other (income) expense, net
Embedded derivatives	—			(1		)	Other (income) expense, net


(1)	All interest rate swaps designated as fair value hedges meet the shortcut method requirements under the accounting standards for derivatives and hedging. Accordingly, changes in the fair values of the interest rate swaps are considered to exactly offset changes in the fair value of the underlying long-term debt. Refer to “Fair Value Hedges” in this note for additional detail.

Refer to Note 3 — Accrued Liabilities for derivative instruments recorded in Accrued liabilities, Note 4 — Fair Value Measurements for a description of how the above financial instruments are valued and Note 10 — Accumulated Other Comprehensive Income for additional information on changes in Accumulated other comprehensive income for the three months ended August 31, 2015 and 2014.

Cash Flow Hedges

The purpose of the Company's foreign exchange risk management program is to lessen both the positive and negative effects of currency fluctuations on the Company's consolidated results of operations, financial position and cash flows. Foreign currency exposures that the Company may elect to hedge in this manner include product cost exposures, non-functional currency denominated external and intercompany revenues, selling and administrative expenses, investments in U.S. Dollar-denominated available-for-sale debt securities and certain other intercompany transactions.

Product cost exposures are primarily generated through non-functional currency denominated product purchases and the foreign currency adjustment program described below. NIKE entities primarily purchase products in two ways: (1) Certain NIKE entities purchase product from the NIKE Trading Company (“NTC”), a wholly-owned sourcing hub that buys NIKE branded products from third party factories, predominantly in U.S. Dollars. The NTC, whose functional currency is the U.S. Dollar, then sells the products to NIKE entities in their respective functional currencies. When the NTC sells to a NIKE entity with a different functional currency, the result is a foreign currency exposure for the NTC. (2) Other NIKE entities purchase product directly from third party factories in U.S. Dollars. These purchases generate a foreign currency exposure for those NIKE entities with a functional currency other than the U.S. Dollar.

The Company operates a foreign currency adjustment program with certain factories. The program is designed to more effectively manage foreign currency risk by assuming certain of the factories’ foreign currency exposures, some of which are natural offsets to the Company's existing foreign currency exposures. Under this program, the Company’s payments to these factories are adjusted for rate fluctuations in the basket of currencies (“factory currency exposure index”) in which the labor, materials and overhead costs incurred by the factories in the production of NIKE branded products (“factory input costs”) are denominated. For the portion of the indices denominated in the local or functional currency of the factory, the Company may elect to place formally designated cash flow hedges. For all currencies within the indices, excluding the U.S. Dollar and the local or functional currency of the factory, an embedded derivative contract is created upon the factory’s acceptance of NIKE’s purchase order. Embedded derivative contracts are separated from the related purchase order, and their accounting treatment is described further below.

The Company’s policy permits the utilization of derivatives to reduce its foreign currency exposures where internal netting or other strategies cannot be effectively employed. Typically, the Company may enter into hedge contracts starting up to 12 to 24 months in advance of the forecasted transaction and may place incremental hedges up to 100% of the exposure by the time the forecasted transaction occurs. The total notional amount of outstanding foreign currency derivatives designated as cash flow hedges was $13.5 billion as of August 31, 2015.

As of August 31, 2015, the Company had outstanding a series of forward-starting interest rate swap agreements with a total notional amount of $1 billion. These instruments were designated as cash flow hedges of the variability in the expected cash outflows of interest payments on future debt due to changes in benchmark interest rates.

All changes in fair value of derivatives designated as cash flow hedges, excluding any ineffective portion, are recorded in Accumulated other comprehensive income until Net income is affected by the variability of cash flows of the hedged transaction. In most cases, amounts recorded in Accumulated other comprehensive income will be released to Net income in periods following the maturity of the related derivative, rather than at maturity. Effective hedge results are classified within the Unaudited Condensed Consolidated Statements of Income in the same manner as the underlying exposure, with the results of hedges of non-functional currency denominated revenues and product cost exposures, excluding embedded derivatives as described below, recorded in Revenues or Cost of sales, when the underlying hedged transaction affects consolidated Net income. Results of hedges of selling and administrative expense are recorded together with those costs when the related expense is recorded. Amounts recorded in Accumulated other comprehensive income related to forward-starting interest rate swaps will be released through Interest expense (income), net over the term of the issued debt. Results of hedges of anticipated purchases and sales of U.S. Dollar-denominated available-for-sale securities are recorded in Other (income) expense, net when the securities are sold. Results of hedges of certain anticipated intercompany transactions are recorded in Other (income) expense, net when the transaction occurs. The Company classifies the cash flows at settlement from these designated cash flow hedge derivatives in the same category as the cash flows from the related hedged items, primarily within the Cash provided by operations component of the Unaudited Condensed Consolidated Statements of Cash Flows.

Premiums paid on options are initially recorded as deferred charges. The Company assesses the effectiveness of options based on the total cash flows method and records total changes in the options’ fair value to Accumulated other comprehensive income to the degree they are effective.

The Company formally assesses, both at a hedge’s inception and on an ongoing basis, whether the derivatives that are used in the hedging transaction have been highly effective in offsetting changes in the cash flows of hedged items and whether those derivatives may be expected to remain highly effective in future periods. Effectiveness for cash flow hedges is assessed based on changes in forward rates. Ineffectiveness was immaterial for the three months ended August 31, 2015 and 2014.

The Company discontinues hedge accounting prospectively when: (1) it determines that the derivative is no longer highly effective in offsetting changes in the cash flows of a hedged item (including hedged items such as firm commitments or forecasted transactions); (2) the derivative expires or is sold, terminated or exercised; (3) it is no longer probable that the forecasted transaction will occur; or (4) management determines that designating the derivative as a hedging instrument is no longer appropriate.

When the Company discontinues hedge accounting because it is no longer probable that the forecasted transaction will occur in the originally expected period, but is expected to occur within an additional two-month period of time thereafter, the gain or loss on the derivative remains in Accumulated other comprehensive income and is reclassified to Net income when the forecasted transaction affects consolidated Net income. However, if it is probable that a forecasted transaction will not occur by the end of the originally specified time period or within an additional two-month period of time thereafter, the gains and losses that were in Accumulated other comprehensive income will be recognized immediately in Other (income) expense, net. In all situations in which hedge accounting is discontinued and the derivative remains outstanding, the Company will carry the derivative at its fair value on the Unaudited Condensed Consolidated Balance Sheets, recognizing future changes in the fair value in Other (income) expense, net. For the three months ended August 31, 2015 and 2014, the amounts recorded in Other (income) expense, net as a result of the discontinuance of cash flow hedging because the forecasted transaction was no longer probable of occurring were immaterial.

As of August 31, 2015, $603 million of deferred net gains (net of tax) on both outstanding and matured derivatives in Accumulated other comprehensive income were expected to be reclassified to Net income during the next 12 months concurrent with the underlying hedged transactions also being recorded in Net income. Actual amounts ultimately reclassified to Net income are dependent on the exchange rates in effect when derivative contracts that are currently outstanding mature. As of August 31, 2015, the maximum term over which the Company was hedging exposures to the variability of cash flows for its forecasted transactions was 33 months.

Fair Value Hedges

The Company is also exposed to the risk of changes in the fair value of certain fixed-rate debt attributable to changes in interest rates. Derivatives currently used by the Company to hedge this risk are receive-fixed, pay-variable interest rate swaps. All interest rate swaps designated as fair value hedges of the related long-term debt meet the shortcut method requirements under the accounting standards for derivatives and hedging. Accordingly, changes in the fair values of the interest rate swaps are considered to exactly offset changes in the fair value of the underlying long-term debt. The cash flows associated with the Company’s fair value hedges are periodic interest payments while the swaps are outstanding, which are reflected within the Cash provided by operations component of the Unaudited Condensed Consolidated Statements of Cash Flows. The Company recorded no ineffectiveness from its interest rate swaps designated as fair value hedges for the three months ended August 31, 2015 or 2014. As of August 31, 2015, interest rate swaps designated as fair value hedges had a total notional amount of $100 million.

Net Investment Hedges

The Company has, in the past, hedged and may, in the future, hedge the risk of variability in foreign-currency-denominated net investments in wholly-owned international operations. All changes in fair value of the derivatives designated as net investment hedges, except ineffective portions, are reported in the cumulative translation adjustment component of Accumulated other comprehensive income along with the foreign currency translation adjustments on those investments. The Company classifies the cash flows at settlement of its net investment hedges within the Cash (used) provided by investing activities component of the Unaudited Condensed Consolidated Statements of Cash Flows. The Company assesses hedge effectiveness based on changes in forward rates. The Company recorded no ineffectiveness from its net investment hedges for the three months ended August 31, 2015 or 2014. The Company had no outstanding net investment hedges as of August 31, 2015.

Undesignated Derivative Instruments

The Company may elect to enter into foreign exchange forwards to mitigate the change in fair value of specific assets and liabilities on the Unaudited Condensed Consolidated Balance Sheets and/or the embedded derivative contracts explained above. These forwards are not designated as hedging instruments under the accounting standards for derivatives and hedging. Accordingly, these undesignated instruments are recorded at fair value as a derivative asset or liability on the Unaudited Condensed Consolidated Balance Sheets with their corresponding change in fair value recognized in Other (income) expense, net, together with the re-measurement gain or loss from the hedged balance sheet position or embedded derivative contract. The Company classifies the cash flows at settlement from undesignated instruments in the same category as the cash flows from the related hedged items, generally within the Cash provided by operations component of the Unaudited Condensed Consolidated Statements of Cash Flows. The total notional amount of outstanding undesignated derivative instruments was $5.3 billion as of August 31, 2015.

Embedded Derivatives

As part of the foreign currency adjustment program described above, an embedded derivative contract is created upon the factory’s acceptance of NIKE’s purchase order for currencies within the factory currency exposure indices that are neither the U.S. Dollar nor the local or functional currency of the factory. Embedded derivative contracts are treated as foreign currency forward contracts that are bifurcated from the related purchase order and recorded at fair value as a derivative asset or liability on the Unaudited Condensed Consolidated Balance Sheets with their corresponding change in fair value recognized in Other (income) expense, net from the date a purchase order is accepted by a factory through the date the purchase price is no longer subject to foreign currency fluctuations.

In addition, the Company has entered into certain other contractual agreements which have payments that are indexed to currencies that are not the functional currency of either substantial party to the contracts. These payment terms expose NIKE to variability in foreign exchange rates and create embedded derivative contracts that must be bifurcated from the related contract and recorded at fair value as derivative assets or liabilities on the Unaudited Consolidated Balance Sheets with their corresponding changes in fair value recognized in Other (income) expense, net until each payment is settled.

At August 31, 2015, the total notional amount of embedded derivatives outstanding was approximately $225 million.

Credit Risk

The Company is exposed to credit-related losses in the event of nonperformance by counterparties to hedging instruments. The counterparties to all derivative transactions are major financial institutions with investment grade credit ratings. However, this does not eliminate the Company’s exposure to credit risk with these institutions. This credit risk is limited to the unrealized gains in such contracts should any of these counterparties fail to perform as contracted. To manage this risk, the Company has established strict counterparty credit guidelines that are continually monitored.

The Company’s derivative contracts contain credit risk related contingent features designed to protect against significant deterioration in counterparties’ creditworthiness and their ultimate ability to settle outstanding derivative contracts in the normal course of business. The Company’s bilateral credit related contingent features generally require the owing entity, either the Company or the derivative counterparty, to post collateral for the portion of the fair value in excess of $50 million should the fair value of outstanding derivatives per counterparty be greater than $50 million. Additionally, a certain level of decline in credit rating of either the Company or the counterparty could also trigger collateral requirements. As of August 31, 2015, the Company was in compliance with all credit risk related contingent features and had no derivative instruments with credit risk related contingent features in a net liability position. Accordingly, the Company was not required to post any collateral as a result of these contingent features. Further, as of August 31, 2015, the Company had received $468 million of cash collateral from various counterparties to its derivative contracts (refer to Note 4 — Fair Value Measurements). Given the considerations described above, the Company considers the impact of the risk of counterparty default to be immaterial.

Accumulated Other Comprehensive Income

NOTE 10 — Accumulated Other Comprehensive Income

The changes in Accumulated other comprehensive income, net of tax, for the three months ended August 31, 2015 were as follows:



(In millions)	Foreign Currency Translation Adjustment⁽¹⁾			Cash Flow Hedges			Net Investment Hedges⁽¹⁾		Other			Total
Balance at May 31, 2015	$	(11	)	$	1,220		$	95	$	(58	)	$	1,246
Other comprehensive gains (losses) before reclassifications⁽²⁾	(81		)	(182		)	—		—			(263		)
Reclassifications to net income of previously deferred (gains) losses⁽³⁾	—			(147		)	—		(3		)	(150		)
Other comprehensive income (loss)	(81		)	(329		)	—		(3		)	(413		)
Balance at August 31, 2015	$	(92	)	$	891		$	95	$	(61	)	$	833


(1)	The accumulated foreign currency translation adjustment and net investment hedge gains/losses related to an investment in a foreign subsidiary are reclassified to Net income upon sale or upon complete or substantially complete liquidation of the respective entity.


(2)	Net of tax benefit (expense) of $0 million, $(2) million, $0 million, $0 million and $(2) million, respectively.


(3)	Net of tax (benefit) expense of $0 million, $1 million, $0 million, $0 million and $1 million, respectively.

The changes in Accumulated other comprehensive income, net of tax, for the three months ended August 31, 2014 were as follows:



(In millions)	Foreign Currency Translation Adjustment⁽¹⁾		Cash Flow Hedges		Net Investment Hedges⁽¹⁾		Other			Total
Balance at May 31, 2014	$	9	$	32	$	95	$	(51	)	$	85
Other comprehensive gains (losses) before reclassifications⁽²⁾	2		119		—		5			126
Reclassifications to net income of previously deferred (gains) losses⁽³⁾	—		16		—		(3		)	13
Other comprehensive income (loss)	2		135		—		2			139
Balance at August 31, 2014	$	11	$	167	$	95	$	(49	)	$	224


(1)	The accumulated foreign currency translation adjustment and net investment hedge gains/losses related to an investment in a foreign subsidiary are reclassified to Net income upon sale or upon complete or substantially complete liquidation of the respective entity.


(2)	Net of tax benefit (expense) of $(11) million, $1 million, $0 million, $(2) million and $(12) million, respectively.


(3)	Net of tax (benefit) expense of $0 million, $(4) million, $0 million, $1 million and $(3) million, respectively.

The following table summarizes the reclassifications from Accumulated other comprehensive income to the Unaudited Condensed Consolidated Statements of Income:



	Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Income						Location of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Income
	Three Months Ended August 31,
(In millions)	2015			2014
Gains (losses) on cash flow hedges:
Foreign exchange forwards and options	$	(43	)	$	(17	)	Revenues
Foreign exchange forwards and options	160			(8		)	Cost of sales
Foreign exchange forwards and options	—			—			Total selling and administrative expense
Foreign exchange forwards and options	31			5			Other (income) expense, net
Total before tax	148			(20		)
Tax (expense) benefit	(1		)	4
Gain (loss) net of tax	147			(16		)
Gains (losses) on other	3			4			Other (income) expense, net
Total before tax	3			4
Tax (expense)	—			(1		)
Gain (loss) net of tax	3			3
Total net gain (loss) reclassified for the period	$	150		$	(13	)

Operating Segments

NOTE 11 — Operating Segments

The Company’s operating segments are evidence of the structure of the Company's internal organization. The NIKE Brand segments are defined by geographic regions for operations participating in NIKE Brand sales activity.

Each NIKE Brand geographic segment operates predominantly in one industry: the design, development and worldwide marketing and selling of athletic footwear, apparel and equipment. The Company’s reportable operating segments for the NIKE Brand are: North America, Western Europe, Central & Eastern Europe, Greater China, Japan and Emerging Markets, and include results for the NIKE, Jordan and Hurley brands. The Company’s NIKE Brand Direct to Consumer operations are managed within each geographic operating segment. Converse is also a reportable segment for the Company and operates in one industry: the design, marketing, licensing and selling of casual sneakers, apparel and accessories.

Global Brand Divisions is included within the NIKE Brand for presentation purposes to align with the way management views the Company. Global Brand Divisions primarily represent NIKE Brand licensing businesses that are not part of a geographic operating segment and demand creation, operating overhead, and product creation and design expenses that are centrally managed for the NIKE Brand.

Corporate consists largely of unallocated general and administrative expenses, including expenses associated with centrally managed departments; depreciation and amortization related to the Company’s headquarters; unallocated insurance, benefit and compensation programs, including stock-based compensation; and certain foreign currency gains and losses, including certain hedge gains and losses.

The primary financial measure used by the Company to evaluate performance of individual operating segments is earnings before interest and taxes (commonly referred to as “EBIT”), which represents Net income before Interest expense (income), net and Income tax expense in the Unaudited Condensed Consolidated Statements of Income. Reconciling items for EBIT represent corporate expense items that are not allocated to the operating segments for management reporting.

As part of the Company's centrally managed foreign exchange risk management program, standard foreign currency rates are assigned twice per year to each NIKE Brand entity in the Company's geographic operating segments and Converse. These rates are set approximately nine months in advance of the future selling season based on average market spot rates in the calendar month preceding the date they are established. Inventories and Cost of sales for geographic operating segments and Converse reflect use of these standard rates to record non-functional currency product purchases in the entity’s functional currency. Differences between assigned standard foreign currency rates and actual market rates are included in Corporate, together with foreign currency hedge gains and losses generated from the Company's centrally managed foreign exchange risk management program and other conversion gains and losses.

Accounts receivable, net, Inventories and Property, plant and equipment, net for operating segments are regularly reviewed by management and are therefore provided below.

Certain prior year amounts have been reclassified to conform to fiscal 2016 presentation.



	Three Months Ended August 31,
(In millions)	2015			2014
REVENUES
North America	$	3,799		$	3,513
Western Europe	1,641			1,713
Central & Eastern Europe	401			393
Greater China	886			679
Japan	179			160
Emerging Markets	966			934
Global Brand Divisions	26			29
Total NIKE Brand	7,898			7,421
Converse	555			575
Corporate	(39		)	(14		)
TOTAL NIKE CONSOLIDATED REVENUES	$	8,414		$	7,982
EARNINGS BEFORE INTEREST AND TAXES
North America	$	1,042		$	970
Western Europe	485			404
Central & Eastern Europe	98			69
Greater China	330			218
Japan	36			11
Emerging Markets	258			156
Global Brand Divisions	(624		)	(534		)
Total NIKE Brand	1,625			1,294
Converse	147			186
Corporate	(323		)	(242		)
Total NIKE Consolidated Earnings Before Interest and Taxes	1,449			1,238
Interest expense (income), net	4			9
TOTAL NIKE CONSOLIDATED EARNINGS BEFORE TAXES	$	1,445		$	1,229



	As of August 31,		As of May 31,
(In millions)	2015		2015
ACCOUNTS RECEIVABLE, NET
North America	$	1,570	$	1,737
Western Europe	499		344
Central & Eastern Europe	249		242
Greater China	76		84
Japan	79		134
Emerging Markets	431		461
Global Brand Divisions	79		88
Total NIKE Brand	2,983		3,090
Converse	288		258
Corporate	17		10
TOTAL ACCOUNTS RECEIVABLE, NET	$	3,288	$	3,358
INVENTORIES
North America	$	2,286	$	2,207
Western Europe	672		699
Central & Eastern Europe	139		169
Greater China	332		249
Japan	106		94
Emerging Markets	507		528
Global Brand Divisions	37		32
Total NIKE Brand	4,079		3,978
Converse	223		237
Corporate	112		122
TOTAL INVENTORIES	$	4,414	$	4,337
PROPERTY, PLANT AND EQUIPMENT, NET
North America	$	643	$	632
Western Europe	485		451
Central & Eastern Europe	45		47
Greater China	239		254
Japan	209		205
Emerging Markets	98		103
Global Brand Divisions	513		484
Total NIKE Brand	2,232		2,176
Converse	116		122
Corporate	764		713
TOTAL PROPERTY, PLANT AND EQUIPMENT, NET	$	3,112	$	3,011

Commitments and Contingencies

NOTE 12 — Commitments and Contingencies

At August 31, 2015, the Company had letters of credit outstanding totaling $154 million. These letters of credit were issued primarily for the purchase of inventory and guarantees of the Company’s performance under certain self-insurance and other programs.

During the fiscal year ended May 31, 2013, the Company divested of Cole Haan. Preexisting guarantees of certain Cole Haan lease payments remained in place after the sale; the maximum exposure under the guarantees was $21 million at August 31, 2015. The fair value of the guarantees is not material.

There have been no other significant subsequent developments relating to the commitments and contingencies reported on the Company's latest Annual Report on Form 10-K.

Summary of Significant Accounting Policies (Policies)

Basis of Presentation

The Unaudited Condensed Consolidated Financial Statements include the accounts of NIKE, Inc. and its subsidiaries (the "Company") and reflect all normal adjustments which are, in the opinion of management, necessary for a fair statement of the results of operations for the interim period. The year-end Condensed Consolidated Balance Sheet data as of May 31, 2015 was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America (“U.S. GAAP”). The interim financial information and notes thereto should be read in conjunction with the Company’s latest Annual Report on Form 10-K. The results of operations for the three months ended August 31, 2015 are not necessarily indicative of results to be expected for the entire year.

Reclassifications

Certain prior year amounts have been reclassified to conform to fiscal 2016 presentation.

Recently Issued Accounting Standards

In May 2014, the Financial Accounting Standards Board ("FASB") issued an accounting standards update that replaces existing revenue recognition guidance. The updated guidance requires companies to recognize revenue in a way that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In addition, the new standard requires that reporting companies disclose the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. Based on the FASB's decision in July 2015 to defer the effective date and to allow more flexibility with implementation, the Company anticipates the new standard will be effective for the Company beginning June 1, 2018. The new standard is required to be applied retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of initially applying it recognized at the date of initial application. The Company has not yet selected a transition method and is currently evaluating the effect the guidance will have on the Consolidated Financial Statements.

Summary of Significant Accounting Policies (Tables)

Schedule of Error Corrections and Prior Period Adjustments



	NIKE, Inc. Unaudited Condensed Consolidated Statements of Cash Flows
	Three Months Ended August 31, 2014								Six Months Ended November 30, 2014
(In millions)	As Reported			Adjustment			As Revised		As Reported			Adjustment			As Revised
Cash provided by operations:
Net income	$	962		$	—		$	962	$	1,617		$	—		$	1,617
Income charges (credits) not affecting cash:
Amortization and other	(34		)	42			8		(54		)	69			15
Net foreign currency adjustments	—			53			53		—			243			243
Cash provided by operations	588			95			683		1,235			312			1,547
Effect of exchange rate changes on cash and equivalents	97			(95		)	2		288			(312		)	(24		)
Net increase (decrease) in cash and equivalents	83			—			83		53			—			53
Cash and equivalents, beginning of period	2,220			—			2,220		2,220			—			2,220
CASH AND EQUIVALENTS, END OF PERIOD	$	2,303		$	—		$	2,303	$	2,273		$	—		$	2,273

Accrued Liabilities (Tables)

Schedule of Accrued Liabilities

Accrued liabilities included the following:



	As of August 31,		As of May 31,
(In millions)	2015		2015
Compensation and benefits, excluding taxes	$	672	$	997
Collateral received from counterparties to hedging instruments	468		968
Endorsement compensation	393		388
Dividends payable	239		240
Taxes other than income taxes	218		174
Import and logistics costs	173		207
Advertising and marketing	126		117
Fair value of derivatives	118		162
Other⁽¹⁾	732		698
TOTAL ACCRUED LIABILITIES	$	3,139	$	3,951


(1)	Other consists of various accrued expenses with no individual item accounting for more than 5% of the total Accrued liabilities balance at August 31, 2015 and May 31, 2015.

Fair Value Measurements (Tables)

Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis

The following tables present information about the Company’s financial assets measured at fair value on a recurring basis as of August 31, 2015 and May 31, 2015, and indicate the level in the fair value hierarchy in which the Company classifies the fair value measurement.



	As of August 31, 2015
(In millions)	Assets at Fair Value		Cash and Equivalents		Short-term Investments		Other Long-term Assets
Cash	$	746	$	746	$	—	$	—
Level 1:
U.S. Treasury securities	1,050		275		775		—
Level 2:
Time deposits	616		616		—		—
U.S. Agency securities	872		15		857		—
Commercial paper and bonds	685		155		530		—
Money market funds	1,439		1,439		—		—
Total Level 2:	3,612		2,225		1,387		—
Level 3:
Non-marketable preferred stock	9		—		—		9
TOTAL	$	5,417	$	3,246	$	2,162	$	9



	As of May 31, 2015
(In millions)	Assets at Fair Value		Cash and Equivalents		Short-term Investments		Other Long-term Assets
Cash	$	615	$	615	$	—	$	—
Level 1:
U.S. Treasury securities	869		225		644		—
Level 2:
Time deposits	684		684		—		—
U.S. Agency securities	976		110		866		—
Commercial paper and bonds	914		352		562		—
Money market funds	1,866		1,866		—		—
Total Level 2:	4,440		3,012		1,428		—
Level 3:
Non-marketable preferred stock	8		—		—		8
TOTAL	$	5,932	$	3,852	$	2,072	$	8

Schedule of Derivative Instruments in Statement of Financial Position, Fair Value

The following tables present information about the Company’s derivative assets and liabilities measured at fair value on a recurring basis as of August 31, 2015 and May 31, 2015, and indicate the level in the fair value hierarchy in which the Company classifies the fair value measurement.



	As of August 31, 2015
	Derivative Assets						Derivative Liabilities
(In millions)	Assets at Fair Value		Other Current Assets		Other Long-term Assets		Liabilities at Fair Value		Accrued Liabilities		Other Long-term Liabilities
Level 2:
Foreign exchange forwards and options⁽¹⁾	$	1,070	$	771	$	299	$	135	$	116	$	19
Embedded derivatives	8		4		4		12		2		10
Interest rate swaps⁽²⁾	76		76		—		—		—		—
TOTAL	$	1,154	$	851	$	303	$	147	$	118	$	29

(1)

If the foreign exchange derivative instruments had been netted on the Unaudited Condensed Consolidated Balance Sheets, the asset and liability positions each would have been reduced by $135 million as of August 31, 2015. As of that date, the Company had received $417 million of cash collateral from various counterparties related to these foreign exchange derivative instruments. No amount of collateral was posted on the Company’s derivative liability balance as of August 31, 2015.


(2)	As of August 31, 2015, the Company had received $51 million of cash collateral related to its interest rate swaps.



	As of May 31, 2015
	Derivative Assets						Derivative Liabilities
(In millions)	Assets at Fair Value		Other Current Assets		Other Long-term Assets		Liabilities at Fair Value		Accrued Liabilities		Other Long-term Liabilities
Level 2:
Foreign exchange forwards and options⁽¹⁾	$	1,554	$	1,034	$	520	$	164	$	160	$	4
Embedded derivatives	7		2		5		11		2		9
Interest rate swaps⁽²⁾	78		78		—		—		—		—
TOTAL	$	1,639	$	1,114	$	525	$	175	$	162	$	13

(1)

If the foreign exchange derivative instruments had been netted on the Consolidated Balance Sheets, the asset and liability positions each would have been reduced by $161 million as of May 31, 2015. As of that date, the Company had received $900 million of cash collateral and $74 million of securities from various counterparties related to these foreign exchange derivative instruments. No amount of collateral was posted on the Company’s derivative liability balance as of May 31, 2015.


(2)	As of May 31, 2015, the Company had received $68 million of cash collateral related to its interest rate swaps.

The following table presents the fair values of derivative instruments included within the Unaudited Condensed Consolidated Balance Sheets as of August 31, 2015 and May 31, 2015:



	Derivative Assets					Derivative Liabilities
(In millions)	Balance Sheet Location	August 31, 2015		May 31, 2015		Balance Sheet Location	August 31, 2015		May 31, 2015
Derivatives formally designated as hedging instruments:
Foreign exchange forwards and options	Prepaid expenses and other current assets	$	662	$	825	Accrued liabilities	$	90	$	140
Interest rate swaps	Prepaid expenses and other current assets	76		78		Accrued liabilities	—		—
Foreign exchange forwards and options	Deferred income taxes and other assets	298		520		Deferred income taxes and other liabilities	10		4
Total derivatives formally designated as hedging instruments		1,036		1,423			100		144
Derivatives not designated as hedging instruments:
Foreign exchange forwards and options	Prepaid expenses and other current assets	109		209		Accrued liabilities	26		20
Embedded derivatives	Prepaid expenses and other current assets	4		2		Accrued liabilities	2		2
Foreign exchange forwards and options	Deferred income taxes and other assets	1		—		Deferred income taxes and other liabilities	9		—
Embedded derivatives	Deferred income taxes and other assets	4		5		Deferred income taxes and other liabilities	10		9
Total derivatives not designated as hedging instruments		118		216			47		31
TOTAL DERIVATIVES		$	1,154	$	1,639		$	147	$	175

Stock-Based Compensation (Tables)

Schedule of Compensation Cost for Share-based Payment Arrangements, Allocation of Share-based Compensation Costs by Plan

The following table summarizes the Company’s total stock-based compensation expense recognized in Operating overhead expense:



	Three Months Ended August 31,
(In millions)	2015		2014
Stock options⁽¹⁾	$	39	$	30
ESPPs	7		6
Restricted stock	8		7
TOTAL STOCK-BASED COMPENSATION EXPENSE	$	54	$	43


(1)	Expense for stock options includes the expense associated with stock appreciation rights. Accelerated stock option expense is recorded for employees eligible for accelerated stock option vesting upon retirement. Accelerated stock option expense for the three month periods ended August 31, 2015 and 2014 was $6 million and $4 million, respectively.

Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions

The weighted average assumptions used to estimate these fair values are as follows:



	Three Months Ended August 31,
	2015		2014
Dividend yield	1.0	%	1.2	%
Expected volatility	23.6	%	23.6	%
Weighted average expected life (in years)	5.8		5.8
Risk-free interest rate	1.7	%	1.7	%

Earnings Per Share (Tables)

Schedule of Earnings Per Share, Basic and Diluted

The following is a reconciliation from basic earnings per common share to diluted earnings per common share. The computations of diluted earnings per common share excluded options to purchase an additional 10.2 million and 9.2 million shares of common stock outstanding for the three month periods ended August 31, 2015 and 2014, respectively, because the options were anti-dilutive.



	Three Months Ended August 31,
(In millions, except per share data)	2015		2014
Determination of shares:
Weighted average common shares outstanding	854.5		864.9
Assumed conversion of dilutive stock options and awards	22.8		21.3
DILUTED WEIGHTED AVERAGE COMMON SHARES OUTSTANDING	877.3		886.2

Earnings per common share:
Basic	$	1.38	$	1.11
Diluted	$	1.34	$	1.09

Risk Management and Derivatives (Tables)

Schedule of Derivative Instruments in Statement of Financial Position, Fair Value

The following tables present information about the Company’s derivative assets and liabilities measured at fair value on a recurring basis as of August 31, 2015 and May 31, 2015, and indicate the level in the fair value hierarchy in which the Company classifies the fair value measurement.



	As of August 31, 2015
	Derivative Assets						Derivative Liabilities
(In millions)	Assets at Fair Value		Other Current Assets		Other Long-term Assets		Liabilities at Fair Value		Accrued Liabilities		Other Long-term Liabilities
Level 2:
Foreign exchange forwards and options⁽¹⁾	$	1,070	$	771	$	299	$	135	$	116	$	19
Embedded derivatives	8		4		4		12		2		10
Interest rate swaps⁽²⁾	76		76		—		—		—		—
TOTAL	$	1,154	$	851	$	303	$	147	$	118	$	29

(1)

If the foreign exchange derivative instruments had been netted on the Unaudited Condensed Consolidated Balance Sheets, the asset and liability positions each would have been reduced by $135 million as of August 31, 2015. As of that date, the Company had received $417 million of cash collateral from various counterparties related to these foreign exchange derivative instruments. No amount of collateral was posted on the Company’s derivative liability balance as of August 31, 2015.


(2)	As of August 31, 2015, the Company had received $51 million of cash collateral related to its interest rate swaps.



	As of May 31, 2015
	Derivative Assets						Derivative Liabilities
(In millions)	Assets at Fair Value		Other Current Assets		Other Long-term Assets		Liabilities at Fair Value		Accrued Liabilities		Other Long-term Liabilities
Level 2:
Foreign exchange forwards and options⁽¹⁾	$	1,554	$	1,034	$	520	$	164	$	160	$	4
Embedded derivatives	7		2		5		11		2		9
Interest rate swaps⁽²⁾	78		78		—		—		—		—
TOTAL	$	1,639	$	1,114	$	525	$	175	$	162	$	13

(1)

If the foreign exchange derivative instruments had been netted on the Consolidated Balance Sheets, the asset and liability positions each would have been reduced by $161 million as of May 31, 2015. As of that date, the Company had received $900 million of cash collateral and $74 million of securities from various counterparties related to these foreign exchange derivative instruments. No amount of collateral was posted on the Company’s derivative liability balance as of May 31, 2015.


(2)	As of May 31, 2015, the Company had received $68 million of cash collateral related to its interest rate swaps.

The following table presents the fair values of derivative instruments included within the Unaudited Condensed Consolidated Balance Sheets as of August 31, 2015 and May 31, 2015:



	Derivative Assets					Derivative Liabilities
(In millions)	Balance Sheet Location	August 31, 2015		May 31, 2015		Balance Sheet Location	August 31, 2015		May 31, 2015
Derivatives formally designated as hedging instruments:
Foreign exchange forwards and options	Prepaid expenses and other current assets	$	662	$	825	Accrued liabilities	$	90	$	140
Interest rate swaps	Prepaid expenses and other current assets	76		78		Accrued liabilities	—		—
Foreign exchange forwards and options	Deferred income taxes and other assets	298		520		Deferred income taxes and other liabilities	10		4
Total derivatives formally designated as hedging instruments		1,036		1,423			100		144
Derivatives not designated as hedging instruments:
Foreign exchange forwards and options	Prepaid expenses and other current assets	109		209		Accrued liabilities	26		20
Embedded derivatives	Prepaid expenses and other current assets	4		2		Accrued liabilities	2		2
Foreign exchange forwards and options	Deferred income taxes and other assets	1		—		Deferred income taxes and other liabilities	9		—
Embedded derivatives	Deferred income taxes and other assets	4		5		Deferred income taxes and other liabilities	10		9
Total derivatives not designated as hedging instruments		118		216			47		31
TOTAL DERIVATIVES		$	1,154	$	1,639		$	147	$	175

Schedule of Derivative Instruments, Gain (Loss) in Statement of Financial Performance

The following tables present the amounts affecting the Unaudited Condensed Consolidated Statements of Income for the three months ended August 31, 2015 and 2014:



(In millions)	Amount of Gain (Loss) Recognized in Other Comprehensive Income on Derivatives⁽¹⁾						Amount of Gain (Loss) Reclassified From Accumulated Other Comprehensive Income into Income⁽¹⁾
	Three Months Ended August 31,						Location of Gain (Loss) Reclassified From Accumulated Other Comprehensive Income into Income	Three Months Ended August 31,
	2015			2014				2015			2014
Derivatives designated as cash flow hedges:
Foreign exchange forwards and options	$	33		$	(38	)	Revenues	$	(43	)	$	(17	)
Foreign exchange forwards and options	(118		)	119			Cost of sales	160			(8		)
Foreign exchange forwards and options	(95		)	37			Other (income) expense, net	31			5
Interest rate swaps	—			—			Interest expense (income), net	—			—
Total designated cash flow hedges	$	(180	)	$	118			$	148		$	(20	)


(1)	For the three months ended August 31, 2015, the amounts recorded in Other (income) expense, net as a result of hedge ineffectiveness and the discontinuance of cash flow hedges because the forecasted transactions were no longer probable of occurring were immaterial.



	Amount of Gain (Loss) Recognized in Income on Derivatives						Location of Gain (Loss) Recognized in Income on Derivatives
	Three Months Ended August 31,
(In millions)	2015			2014
Derivatives designated as fair value hedges:
Interest rate swaps⁽¹⁾	$	1		$	1		Interest expense (income), net
Derivatives not designated as hedging instruments:
Foreign exchange forwards and options	(29		)	93			Other (income) expense, net
Embedded derivatives	—			(1		)	Other (income) expense, net


(1)	All interest rate swaps designated as fair value hedges meet the shortcut method requirements under the accounting standards for derivatives and hedging. Accordingly, changes in the fair values of the interest rate swaps are considered to exactly offset changes in the fair value of the underlying long-term debt. Refer to “Fair Value Hedges” in this note for additional detail.

Accumulated Other Comprehensive Income (Tables)

Schedule of Accumulated Other Comprehensive Income

The changes in Accumulated other comprehensive income, net of tax, for the three months ended August 31, 2015 were as follows:



(In millions)	Foreign Currency Translation Adjustment⁽¹⁾			Cash Flow Hedges			Net Investment Hedges⁽¹⁾		Other			Total
Balance at May 31, 2015	$	(11	)	$	1,220		$	95	$	(58	)	$	1,246
Other comprehensive gains (losses) before reclassifications⁽²⁾	(81		)	(182		)	—		—			(263		)
Reclassifications to net income of previously deferred (gains) losses⁽³⁾	—			(147		)	—		(3		)	(150		)
Other comprehensive income (loss)	(81		)	(329		)	—		(3		)	(413		)
Balance at August 31, 2015	$	(92	)	$	891		$	95	$	(61	)	$	833


(1)	The accumulated foreign currency translation adjustment and net investment hedge gains/losses related to an investment in a foreign subsidiary are reclassified to Net income upon sale or upon complete or substantially complete liquidation of the respective entity.


(2)	Net of tax benefit (expense) of $0 million, $(2) million, $0 million, $0 million and $(2) million, respectively.


(3)	Net of tax (benefit) expense of $0 million, $1 million, $0 million, $0 million and $1 million, respectively.

The changes in Accumulated other comprehensive income, net of tax, for the three months ended August 31, 2014 were as follows:



(In millions)	Foreign Currency Translation Adjustment⁽¹⁾		Cash Flow Hedges		Net Investment Hedges⁽¹⁾		Other			Total
Balance at May 31, 2014	$	9	$	32	$	95	$	(51	)	$	85
Other comprehensive gains (losses) before reclassifications⁽²⁾	2		119		—		5			126
Reclassifications to net income of previously deferred (gains) losses⁽³⁾	—		16		—		(3		)	13
Other comprehensive income (loss)	2		135		—		2			139
Balance at August 31, 2014	$	11	$	167	$	95	$	(49	)	$	224


(1)	The accumulated foreign currency translation adjustment and net investment hedge gains/losses related to an investment in a foreign subsidiary are reclassified to Net income upon sale or upon complete or substantially complete liquidation of the respective entity.


(2)	Net of tax benefit (expense) of $(11) million, $1 million, $0 million, $(2) million and $(12) million, respectively.


(3)	Net of tax (benefit) expense of $0 million, $(4) million, $0 million, $1 million and $(3) million, respectively.

Reclassification out of Accumulated Other Comprehensive Income

The following table summarizes the reclassifications from Accumulated other comprehensive income to the Unaudited Condensed Consolidated Statements of Income:



	Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Income						Location of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Income
	Three Months Ended August 31,
(In millions)	2015			2014
Gains (losses) on cash flow hedges:
Foreign exchange forwards and options	$	(43	)	$	(17	)	Revenues
Foreign exchange forwards and options	160			(8		)	Cost of sales
Foreign exchange forwards and options	—			—			Total selling and administrative expense
Foreign exchange forwards and options	31			5			Other (income) expense, net
Total before tax	148			(20		)
Tax (expense) benefit	(1		)	4
Gain (loss) net of tax	147			(16		)
Gains (losses) on other	3			4			Other (income) expense, net
Total before tax	3			4
Tax (expense)	—			(1		)
Gain (loss) net of tax	3			3
Total net gain (loss) reclassified for the period	$	150		$	(13	)

Operating Segments (Tables)

Schedule of Segment Reporting Information, by Segment



	Three Months Ended August 31,
(In millions)	2015			2014
REVENUES
North America	$	3,799		$	3,513
Western Europe	1,641			1,713
Central & Eastern Europe	401			393
Greater China	886			679
Japan	179			160
Emerging Markets	966			934
Global Brand Divisions	26			29
Total NIKE Brand	7,898			7,421
Converse	555			575
Corporate	(39		)	(14		)
TOTAL NIKE CONSOLIDATED REVENUES	$	8,414		$	7,982
EARNINGS BEFORE INTEREST AND TAXES
North America	$	1,042		$	970
Western Europe	485			404
Central & Eastern Europe	98			69
Greater China	330			218
Japan	36			11
Emerging Markets	258			156
Global Brand Divisions	(624		)	(534		)
Total NIKE Brand	1,625			1,294
Converse	147			186
Corporate	(323		)	(242		)
Total NIKE Consolidated Earnings Before Interest and Taxes	1,449			1,238
Interest expense (income), net	4			9
TOTAL NIKE CONSOLIDATED EARNINGS BEFORE TAXES	$	1,445		$	1,229

Reconciliation of Assets from Segment to Consolidated



	As of August 31,		As of May 31,
(In millions)	2015		2015
ACCOUNTS RECEIVABLE, NET
North America	$	1,570	$	1,737
Western Europe	499		344
Central & Eastern Europe	249		242
Greater China	76		84
Japan	79		134
Emerging Markets	431		461
Global Brand Divisions	79		88
Total NIKE Brand	2,983		3,090
Converse	288		258
Corporate	17		10
TOTAL ACCOUNTS RECEIVABLE, NET	$	3,288	$	3,358
INVENTORIES
North America	$	2,286	$	2,207
Western Europe	672		699
Central & Eastern Europe	139		169
Greater China	332		249
Japan	106		94
Emerging Markets	507		528
Global Brand Divisions	37		32
Total NIKE Brand	4,079		3,978
Converse	223		237
Corporate	112		122
TOTAL INVENTORIES	$	4,414	$	4,337
PROPERTY, PLANT AND EQUIPMENT, NET
North America	$	643	$	632
Western Europe	485		451
Central & Eastern Europe	45		47
Greater China	239		254
Japan	209		205
Emerging Markets	98		103
Global Brand Divisions	513		484
Total NIKE Brand	2,232		2,176
Converse	116		122
Corporate	764		713
TOTAL PROPERTY, PLANT AND EQUIPMENT, NET	$	3,112	$	3,011

Summary of Significant Accounting Policies - Revisions (Details) (USD $)

In Millions, unless otherwise specified

3 Months Ended

6 Months Ended

Aug. 31, 2015

Aug. 31, 2014

Nov. 30, 2014

Cash provided by operations:

Net income

$ 1,179

$ 962

$ 1,617

Amortization and other

11

8

15

Net foreign currency adjustments

32

53

243

Cash provided by operations

491

683

1,547

Cash (used) provided by investing activities:

Effect of exchange rate changes on cash and equivalents

(38)

2

(24)

Cash used by financing activities:

Net increase (decrease) in cash and equivalents

(606)

83

53

Cash and equivalents, beginning of period

3,852

2,220

CASH AND EQUIVALENTS, END OF PERIOD

3,246

2,303

2,273

As Reported

Cash provided by operations:

Net income

962

1,617

Amortization and other

(34)

(54)

Net foreign currency adjustments

0

Cash provided by operations

588

1,235

Cash (used) provided by investing activities:

Effect of exchange rate changes on cash and equivalents

97

288

Cash used by financing activities:

Net increase (decrease) in cash and equivalents

83

53

Cash and equivalents, beginning of period

2,220

CASH AND EQUIVALENTS, END OF PERIOD

2,303

2,273

Prior Period Revisions to Foreign Currency Adjustments

Cash used by financing activities:

Net increase (decrease) in cash and equivalents

0

Prior Period Revisions to Foreign Currency Adjustments |
Adjustment

Cash provided by operations:

Net income

0

Amortization and other

42

69

Net foreign currency adjustments

53

243

Cash provided by operations

95

312

Cash (used) provided by investing activities:

Effect of exchange rate changes on cash and equivalents

(95)

(312)

Cash used by financing activities:

Net increase (decrease) in cash and equivalents

0

Cash and equivalents, beginning of period

0

CASH AND EQUIVALENTS, END OF PERIOD

$ 0

Inventories - Additional Information (Detail) (USD $)

In Millions, unless otherwise specified

Aug. 31, 2015

May 31, 2015

Inventory Disclosure [Abstract]

Inventory balances (substantially all finished goods)

$ 4,414

$ 4,337

Accrued Liabilities (Detail) (USD $)

In Millions, unless otherwise specified

Aug. 31, 2015

May 31, 2015

Accrued Liabilities, Current [Abstract]

Compensation and benefits, excluding taxes

$ 672

$ 997

Collateral received from counterparties to hedging instruments

468

968

Endorsement compensation

393

388

Dividends payable

239

240

Accrual for Taxes Other than Income Taxes, Current

218

174

Import and logistics costs

173

207

Advertising and marketing

126

117

Fair value of derivatives

118

162

Other

732 ¹

698 ¹

TOTAL ACCRUED LIABILITIES

$ 3,139

$ 3,951

Maximum percent of accrued liabilities to be included in Other (percent)

5.00%

[1] Other consists of various accrued expenses with no individual item accounting for more than 5% of the total Accrued liabilities balance at August 31, 2015 and May 31, 2015.

Fair Value Measurements - Financial Assets and Liabilities Measured at Fair Value on Recurring Basis (Detail) (Fair Value, Measurements, Recurring, USD $)

In Millions, unless otherwise specified

Aug. 31, 2015

May 31, 2015

Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]

Cash

$ 746

$ 615

Assets at Fair Value

5,417

5,932

Cash and Equivalents

3,246

3,852

Short-term Investments

2,162

2,072

Other Long-term Assets

9

8

Fair Value Measurements Using Level 1 |
U.S. Treasury securities

Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]

Assets at Fair Value

1,050

869

Cash and Equivalents

275

225

Short-term Investments

775

644

Other Long-term Assets

0

Fair Value Measurements Using Level 2

Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]

Assets at Fair Value

3,612

4,440

Cash and Equivalents

2,225

3,012

Short-term Investments

1,387

1,428

Other Long-term Assets

0

Fair Value Measurements Using Level 2 |
Time deposits

Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]

Assets at Fair Value

616

684

Cash and Equivalents

616

684

Short-term Investments

0

Other Long-term Assets

0

Fair Value Measurements Using Level 2 |
U.S. Agency securities

Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]

Assets at Fair Value

872

976

Cash and Equivalents

15

110

Short-term Investments

857

866

Other Long-term Assets

0

Fair Value Measurements Using Level 2 |
Commercial paper and bonds

Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]

Assets at Fair Value

685

914

Cash and Equivalents

155

352

Short-term Investments

530

562

Other Long-term Assets

0

Fair Value Measurements Using Level 2 |
Money market funds

Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]

Assets at Fair Value

1,439

1,866

Cash and Equivalents

1,439

1,866

Short-term Investments

0

Other Long-term Assets

0

Fair Value Measurements Using Level 3 |
Non-marketable preferred stock

Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]

Assets at Fair Value

9

8

Cash and Equivalents

0

Short-term Investments

0

Other Long-term Assets

$ 9

$ 8

Fair Value Measurements - Derivative Assets and Liabilities at Fair Value (Detail) (USD $)

Aug. 31, 2015

May 31, 2015

Derivatives, Fair Value [Line Items]

Accrued Liabilities

$ 118,000,000

$ 162,000,000

Collateral received from counterparties to hedging instruments

468,000,000

968,000,000

Fair Value, Measurements, Recurring |
Foreign exchange forwards and options

Derivatives, Fair Value [Line Items]

Reduction in derivative assets if netted

135,000,000

161,000,000

Reduction in derivative liabilities if netted

135,000,000

161,000,000

Fair Value Measurements Using Level 2 |
Fair Value, Measurements, Recurring

Derivatives, Fair Value [Line Items]

Assets at Fair Value

1,154,000,000

1,639,000,000

Other Current Assets

851,000,000

1,114,000,000

Other Long-term Assets

303,000,000

525,000,000

Liabilities at Fair Value

147,000,000

175,000,000

Accrued Liabilities

118,000,000

162,000,000

Other Long-term Liabilities

29,000,000

13,000,000

Fair Value Measurements Using Level 2 |
Fair Value, Measurements, Recurring |
Foreign exchange forwards and options

Derivatives, Fair Value [Line Items]

Assets at Fair Value

1,070,000,000 ¹

1,554,000,000 ²

Other Current Assets

771,000,000 ¹

1,034,000,000 ²

Other Long-term Assets

299,000,000 ¹

520,000,000 ²

Liabilities at Fair Value

135,000,000 ¹

164,000,000 ²

Accrued Liabilities

116,000,000 ¹

160,000,000 ²

Other Long-term Liabilities

19,000,000 ¹

4,000,000 ²

Fair Value Measurements Using Level 2 |
Fair Value, Measurements, Recurring |
Embedded derivatives

Derivatives, Fair Value [Line Items]

Assets at Fair Value

8,000,000

7,000,000

Other Current Assets

4,000,000

2,000,000

Other Long-term Assets

4,000,000

5,000,000

Liabilities at Fair Value

12,000,000

11,000,000

Accrued Liabilities

2,000,000

Other Long-term Liabilities

10,000,000

9,000,000

Fair Value Measurements Using Level 2 |
Fair Value, Measurements, Recurring |
Interest rate swap

Derivatives, Fair Value [Line Items]

Assets at Fair Value

76,000,000 ³

78,000,000 ⁴

Other Current Assets

76,000,000 ³

78,000,000 ⁴

Other Long-term Assets

0 ³

0 ⁴

Liabilities at Fair Value

0 ³

0 ⁴

Accrued Liabilities

0 ³

0 ⁴

Other Long-term Liabilities

0 ³

0 ⁴

Cash and Cash Equivalents

Derivatives, Fair Value [Line Items]

Collateral received from counterparties to hedging instruments

468,000,000

Cash and Cash Equivalents |
Foreign exchange forwards and options

Derivatives, Fair Value [Line Items]

Collateral received from counterparties to hedging instruments

417,000,000

900,000,000

Derivative liability, fair value of collateral

0

Cash and Cash Equivalents |
Interest rate swap

Derivatives, Fair Value [Line Items]

Collateral received from counterparties to hedging instruments

51,000,000

68,000,000

Accrued Liabilities

Derivatives, Fair Value [Line Items]

Collateral received from counterparties to hedging instruments

0

Securities Pledged as Collateral |
Foreign exchange forwards and options

Derivatives, Fair Value [Line Items]

Collateral received from counterparties to hedging instruments

$ 74,000,000

[1] If the foreign exchange derivative instruments had been netted on the Unaudited Condensed Consolidated Balance Sheets, the asset and liability positions each would have been reduced by $135 million as of August 31, 2015. As of that date, the Company had received $417 million of cash collateral from various counterparties related to these foreign exchange derivative instruments. No amount of collateral was posted on the Company’s derivative liability balance as of August 31, 2015.

[2] If the foreign exchange derivative instruments had been netted on the Consolidated Balance Sheets, the asset and liability positions each would have been reduced by $161 million as of May 31, 2015. As of that date, the Company had received $900 million of cash collateral and $74 million of securities from various counterparties related to these foreign exchange derivative instruments. No amount of collateral was posted on the Company’s derivative liability balance as of May 31, 2015.

[3] As of August 31, 2015, the Company had received $51 million of cash collateral related to its interest rate swaps.

[4] As of May 31, 2015, the Company had received $68 million of cash collateral related to its interest rate swaps.

Fair Value Measurements - Additional Information (Detail) (USD $)

3 Months Ended

Aug. 31, 2015

Aug. 31, 2014

May 31, 2015

Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]

Available-for-sale securities with maturity dates within one year from purchase date

$ 1,905,000,000

Available-for-sale securities with maturity dates over one year and less than five years from purchase date

257,000,000

Interest income

2,000,000

1,000,000

Fair value of long term debt

1,130,000,000

1,160,000,000

Fair value transfers between fair value hierarchy levels

0

Assets, fair value disclosure, nonrecurring

0

Liabilities, fair value disclosure, nonrecurring

0

Prepaid Expenses and Other Current Assets

Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]

Outstanding receivables

200,000,000

150,000,000

Foreign exchange forwards and options |
Cash and Cash Equivalents

Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]

Derivative liability, fair value of collateral

$ 0

Short-Term Borrowings and Credit Lines - Credit Facility (Details) (Revolving Credit Facility, USD $)

3 Months Ended

Aug. 31, 2015

Aug. 28, 2015

Nov. 1, 2011

Short-term Debt [Line Items]

Maximum borrowing capacity

$ 2,000,000,000

$ 1,000,000,000

Extension period after maturity

1 year

Facility fee as a percent of total commitment

0.045%

Amount outstanding under committed credit facility

$ 0

London Interbank Offered Rate (LIBOR)

Short-term Debt [Line Items]

Basis spread on variable rate

0.455%

Income Taxes - Income before Income Taxes (Detail) (USD $)

In Millions, unless otherwise specified

3 Months Ended

Aug. 31, 2015

Aug. 31, 2014

May 31, 2015

Income Tax Contingency [Line Items]

Effective tax rate on continuing operations (percent)

18.40%

21.70%

Total gross unrecognized tax benefits, excluding related interest and penalties

$ 460

$ 438

Total gross unrecognized tax benefits, excluding related interest and penalties, amount which would affect the Company's effective tax rate if recognized in future periods

258

Change in income tax penalties and interest accrued

13

Accrued interest and penalties related to uncertain tax positions (excluding federal benefit)

177

164

Estimated decrease in total gross unrecognized tax benefits as a result of resolutions of global tax examinations and expiration of applicable statutes of limitations

43

Tax Year 2011 |
Domestic Tax Authority

Income Tax Contingency [Line Items]

Proposed increase in tax related to the foreign tax credit matter

$ 31

Stock Based Compensation - Additional Information (Detail) (USD $)

In Millions, except Share data, unless otherwise specified

3 Months Ended

Aug. 31, 2015

Aug. 31, 2014

Class A Convertible Common Stock

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Common stock, no par value

$ 0

Common stock, shares authorized

400,000,000

Common stock, conversion basis

Each share of Class A Common Stock is convertible into one share of Class B Common Stock.

Class B Common Stock

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Common stock, no par value

$ 0

Common stock, shares authorized

2,400,000,000

Stock Incentive Plan 1990 |
Class B Common Stock

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Shares available for grant (in shares)

359,000,000

Stock Incentive Plan 1990 |
Employee Stock Option |
Class B Common Stock

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Stock options vesting period (in years)

4 years

Stock options expiration from the date of grant (in years)

10 years

Accelerated stock option expense

$ 6

$ 4

Unrecognized compensation costs from stock options, net of estimated forfeitures

$ 377

Unrecognized compensation costs from stock options, net of estimated forfeitures, to be recognized as operating overhead expense over a weighted average period (in years)

2 years 8 months 12 days

Weighted average fair value per share of the options granted (in dollars per share)

$ 25.32

$ 16.91

Minimum term of market traded options for estimates of expected volatility (in years)

1 year

Employee Stock Purchase Plans |
Employee Stock |
Class B Common Stock

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Employee stock purchase plans, payroll deductions (percent)

10.00%

Employee stock purchase plan offering period (in months)

6 months

Shares purchased, price as percentage of lower of the fair market value (percent)

85.00%

Common Stock and Stock-Based Compensation - Total Stock-Based Compensation Expense (Detail) (USD $)

In Millions, unless otherwise specified

3 Months Ended

Aug. 31, 2015

Aug. 31, 2014

Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]

Stock-based compensation expense

$ 54

$ 43

Class B Common Stock

Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]

Stock-based compensation expense

54

43

Class B Common Stock |
Stock Incentive Plan 1990 |
Employee Stock Option

Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]

Stock-based compensation expense

39 ¹

30 ¹

Accelerated stock option expense

6

4

Class B Common Stock |
Stock Incentive Plan 1990 |
Restricted stock

Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]

Stock-based compensation expense

8

7

Class B Common Stock |
Employee Stock Purchase Plans |
Employee Stock

Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]

Stock-based compensation expense

$ 7

$ 6

[1] Expense for stock options includes the expense associated with stock appreciation rights. Accelerated stock option expense is recorded for employees eligible for accelerated stock option vesting upon retirement. Accelerated stock option expense for the three month periods ended August 31, 2015 and 2014 was $6 million and $4 million, respectively.

Common Stock and Stock-Based Compensation - Weighted Average Assumptions Used to Estimate Fair Values (Detail) (Employee Stock Option, Stock Incentive Plan 1990, Class B Common Stock)

3 Months Ended

Aug. 31, 2015

Aug. 31, 2014

Employee Stock Option |
Stock Incentive Plan 1990 |
Class B Common Stock

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Dividend yield

1.00%

1.20%

Expected volatility

23.60%

Weighted average expected life (in years)

5 years 9 months

5 years 9 months 18 days

Risk-free interest rate

1.70%

Earnings Per Share - Additional Information (Detail)

In Millions, unless otherwise specified

3 Months Ended

Aug. 31, 2015

Aug. 31, 2014

Earnings Per Share [Abstract]

Anti-dilutive options not included in the computation of diluted earnings per share

10.2

9.2

Earnings Per Share - Reconciliation from Basic Earnings Per Share to Diluted Earnings Per Share (Detail) (USD $)

In Millions, except Per Share data, unless otherwise specified

3 Months Ended

Aug. 31, 2015

Aug. 31, 2014

Determination of shares:

Weighted average common shares outstanding

854.5

864.9

Assumed conversion of dilutive stock options and awards

22.8

21.3

DILUTED WEIGHTED AVERAGE COMMON SHARES OUTSTANDING

877.3

886.2

Basic (in dollars per share)

$ 1.38

$ 1.11

Diluted (in dollars per share)

$ 1.34

$ 1.09

Risk Management and Derivatives - Additional Information (Detail) (USD $)

3 Months Ended

Aug. 31, 2015

May 31, 2015

Derivative Instruments and Hedging Activities Disclosure [Line Items]

Percentage of anticipated exposures hedged (percent)

100.00%

Deferred net gains (net of tax) on both outstanding and matured derivatives accumulated in other comprehensive income are expected to be reclassified to net income during the next twelve months as a result of underlying hedged transactions also being recorded in net income

$ 603,000,000

Maximum term over which the Company is hedging exposures to the variability of cash flows for its forecasted and recorded transactions (in months)

33 months

Aggregate fair value of derivative instruments in net liability position

0

Collateral received from counterparties to hedging instruments

468,000,000

968,000,000

Embedded derivatives

Derivative Instruments and Hedging Activities Disclosure [Line Items]

Total notional amount of outstanding derivatives

225,000,000

Undesignated Derivative Instruments

Derivative Instruments and Hedging Activities Disclosure [Line Items]

Total notional amount of outstanding derivatives

5,300,000,000

Minimum

Derivative Instruments and Hedging Activities Disclosure [Line Items]

Typical time period that anticipated exposures are hedged against (in months)

12 months

Minimum fair value of outstanding derivative above which the credit related contingent features require the derivative party to post collateral

50,000,000

Maximum

Derivative Instruments and Hedging Activities Disclosure [Line Items]

Typical time period that anticipated exposures are hedged against (in months)

24 months

Fair Value Hedging |
Interest rate swap

Derivative Instruments and Hedging Activities Disclosure [Line Items]

Total notional amount of outstanding derivatives

100,000,000

Cash Flow Hedging

Derivative Instruments and Hedging Activities Disclosure [Line Items]

Total notional amount of outstanding derivatives

13,500,000,000

Cash Flow Hedging |
Designated as Hedging Instrument |
Interest rate swap

Derivative Instruments and Hedging Activities Disclosure [Line Items]

Total notional amount of outstanding derivatives

1,000,000,000

Net Investment Hedging [Member] |
Foreign exchange forwards and options

Derivative Instruments and Hedging Activities Disclosure [Line Items]

Derivative assets (liabilities), at fair value, net

0

Securities Pledged as Collateral |
Foreign exchange forwards and options

Derivative Instruments and Hedging Activities Disclosure [Line Items]

Collateral received from counterparties to hedging instruments

74,000,000

Accrued Liabilities

Derivative Instruments and Hedging Activities Disclosure [Line Items]

Collateral received from counterparties to hedging instruments

0

Cash and Cash Equivalents

Derivative Instruments and Hedging Activities Disclosure [Line Items]

Collateral received from counterparties to hedging instruments

468,000,000

Cash and Cash Equivalents |
Interest rate swap

Derivative Instruments and Hedging Activities Disclosure [Line Items]

Collateral received from counterparties to hedging instruments

51,000,000

68,000,000

Cash and Cash Equivalents |
Foreign exchange forwards and options

Derivative Instruments and Hedging Activities Disclosure [Line Items]

Collateral received from counterparties to hedging instruments

$ 417,000,000

$ 900,000,000

Risk Management and Derivatives - FV of Derivative Instruments Included within Consolidated Balance Sheet (Detail) (USD $)

In Millions, unless otherwise specified

Aug. 31, 2015

May 31, 2015

Derivatives, Fair Value [Line Items]

Derivative Assets

$ 1,154

$ 1,639

Derivative Liabilities

147

175

Designated as Hedging Instrument

Derivatives, Fair Value [Line Items]

Derivative Assets

1,036

1,423

Derivative Liabilities

100

144

Designated as Hedging Instrument |
Foreign exchange forwards and options |
Prepaid Expenses and Other Current Assets

Derivatives, Fair Value [Line Items]

Derivative Assets

662

825

Designated as Hedging Instrument |
Foreign exchange forwards and options |
Deferred income taxes and other long-term assets

Derivatives, Fair Value [Line Items]

Derivative Assets

298

520

Designated as Hedging Instrument |
Foreign exchange forwards and options |
Accrued Liabilities

Derivatives, Fair Value [Line Items]

Derivative Liabilities

90

140

Designated as Hedging Instrument |
Foreign exchange forwards and options |
Deferred income taxes and other long-term liabilities

Derivatives, Fair Value [Line Items]

Derivative Liabilities

10

4

Designated as Hedging Instrument |
Interest rate swap |
Prepaid Expenses and Other Current Assets

Derivatives, Fair Value [Line Items]

Derivative Assets

76

78

Designated as Hedging Instrument |
Interest rate swap |
Accrued Liabilities

Derivatives, Fair Value [Line Items]

Derivative Liabilities

0

Derivatives not designated as hedging instruments

Derivatives, Fair Value [Line Items]

Derivative Assets

118

216

Derivative Liabilities

47

31

Derivatives not designated as hedging instruments |
Foreign exchange forwards and options |
Prepaid Expenses and Other Current Assets

Derivatives, Fair Value [Line Items]

Derivative Assets

109

209

Derivatives not designated as hedging instruments |
Foreign exchange forwards and options |
Deferred income taxes and other long-term assets

Derivatives, Fair Value [Line Items]

Derivative Assets

1

0

Derivative Liabilities

9

0

Derivatives not designated as hedging instruments |
Foreign exchange forwards and options |
Accrued Liabilities

Derivatives, Fair Value [Line Items]

Derivative Liabilities

26

20

Derivatives not designated as hedging instruments |
Embedded derivatives |
Prepaid Expenses and Other Current Assets

Derivatives, Fair Value [Line Items]

Derivative Assets

4

2

Derivatives not designated as hedging instruments |
Embedded derivatives |
Deferred income taxes and other long-term assets

Derivatives, Fair Value [Line Items]

Derivative Assets

4

5

Derivative Liabilities

10

9

Derivatives not designated as hedging instruments |
Embedded derivatives |
Accrued Liabilities

Derivatives, Fair Value [Line Items]

Derivative Liabilities

$ 2

Risk Management and Derivatives - Amounts Affecting Consolidated Statements of Income (Detail) (USD $)

In Millions, unless otherwise specified

3 Months Ended

Aug. 31, 2015

Aug. 31, 2014

Derivatives designated as cash flow hedges

Derivative Instruments, Gain (Loss) [Line Items]

Amount of Gain (Loss) Recognized in Other Comprehensive Income on Derivatives

$ (180)¹

$ 118 ¹

Amount of Gain (Loss) Reclassified From Accumulated Other Comprehensive Income into Income

148 ¹

(20)¹

Derivatives designated as cash flow hedges |
Foreign exchange forwards and options |
Revenue

Derivative Instruments, Gain (Loss) [Line Items]

Amount of Gain (Loss) Recognized in Other Comprehensive Income on Derivatives

33 ¹

(38)¹

Amount of Gain (Loss) Reclassified From Accumulated Other Comprehensive Income into Income

(43)¹

(17)¹

Derivatives designated as cash flow hedges |
Foreign exchange forwards and options |
Cost of sales

Derivative Instruments, Gain (Loss) [Line Items]

Amount of Gain (Loss) Recognized in Other Comprehensive Income on Derivatives

(118)¹

119 ¹

Amount of Gain (Loss) Reclassified From Accumulated Other Comprehensive Income into Income

160 ¹

(8)¹

Derivatives designated as cash flow hedges |
Foreign exchange forwards and options |
Other (income) expense, net

Derivative Instruments, Gain (Loss) [Line Items]

Amount of Gain (Loss) Recognized in Other Comprehensive Income on Derivatives

(95)¹

37 ¹

Amount of Gain (Loss) Reclassified From Accumulated Other Comprehensive Income into Income

31 ¹

5 ¹

Derivatives designated as cash flow hedges |
Interest rate swap |
Interest expense (income), net

Derivative Instruments, Gain (Loss) [Line Items]

Amount of Gain (Loss) Recognized in Other Comprehensive Income on Derivatives

0 ¹

Amount of Gain (Loss) Reclassified From Accumulated Other Comprehensive Income into Income

0 ¹

Fair Value Hedging |
Interest rate swap |
Interest expense (income), net

Derivative Instruments, Gain (Loss) [Line Items]

Amount of Gain (Loss) Recognized in Income on Derivatives

1 ²

Derivatives not designated as hedging instruments |
Foreign exchange forwards and options |
Other (income) expense, net

Derivative Instruments, Gain (Loss) [Line Items]

Amount of Gain (Loss) Recognized in Income on Derivatives

(29)

93

Derivatives not designated as hedging instruments |
Embedded derivatives |
Other (income) expense, net

Derivative Instruments, Gain (Loss) [Line Items]

Amount of Gain (Loss) Recognized in Income on Derivatives

$ 0

$ (1)

[1] For the three months ended August 31, 2015, the amounts recorded in Other (income) expense, net as a result of hedge ineffectiveness and the discontinuance of cash flow hedges because the forecasted transactions were no longer probable of occurring were immaterial.

[2] All interest rate swaps designated as fair value hedges meet the shortcut method requirements under the accounting standards for derivatives and hedging. Accordingly, changes in the fair values of the interest rate swaps are considered to exactly offset changes in the fair value of the underlying long-term debt. Refer to “Fair Value Hedges” in this note for additional detail.

Accumulated Other Comprehensive Income - Changes in AOCI (Detail) (USD $)

In Millions, unless otherwise specified

3 Months Ended

Aug. 31, 2015

Aug. 31, 2014

AOCI Including Portion Attributable to Noncontrolling, net of Tax [Roll Forward]

Accumulated other comprehensive income balance at the beginning of the period

$ 1,246

$ 85

Other comprehensive gains (losses) before reclassifications, net of tax

(263)¹

126 ²

Reclassifications to net income of previously deferred (gains) losses, net of tax

(150)³

13 ⁴

Total other comprehensive income (loss), net of tax

(413)

139

Accumulated other comprehensive income balance at the end of the period

833

224

Other comprehensive income, before reclassification, tax benefit (expense)

(2)

(12)

Reclassification from accumulated other comprehensive income, tax (benefit) expense

1

(3)

Foreign Currency Translation Adjustment

AOCI Including Portion Attributable to Noncontrolling, net of Tax [Roll Forward]

Accumulated other comprehensive income balance at the beginning of the period

(11)⁵

9 ⁵

Other comprehensive gains (losses) before reclassifications, net of tax

(81)¹ ⁵

2 ² ⁵

Reclassifications to net income of previously deferred (gains) losses, net of tax

0 ³ ⁵

0 ⁴ ⁵

Total other comprehensive income (loss), net of tax

(81)⁵

2 ⁵

Accumulated other comprehensive income balance at the end of the period

(92)⁵

11 ⁵

Other comprehensive income, before reclassification, tax benefit (expense)

0

(11)

Reclassification from accumulated other comprehensive income, tax (benefit) expense

0

Cash Flow Hedges

AOCI Including Portion Attributable to Noncontrolling, net of Tax [Roll Forward]

Accumulated other comprehensive income balance at the beginning of the period

1,220

32

Other comprehensive gains (losses) before reclassifications, net of tax

(182)¹

119 ²

Reclassifications to net income of previously deferred (gains) losses, net of tax

(147)³

16 ⁴

Total other comprehensive income (loss), net of tax

(329)

135

Accumulated other comprehensive income balance at the end of the period

891

167

Other comprehensive income, before reclassification, tax benefit (expense)

(2)

1

Reclassification from accumulated other comprehensive income, tax (benefit) expense

1

(4)

Net Investment Hedges

AOCI Including Portion Attributable to Noncontrolling, net of Tax [Roll Forward]

Accumulated other comprehensive income balance at the beginning of the period

95 ⁵

Other comprehensive gains (losses) before reclassifications, net of tax

0 ¹ ⁵

0 ² ⁵

Reclassifications to net income of previously deferred (gains) losses, net of tax

0 ³ ⁵

0 ⁴ ⁵

Total other comprehensive income (loss), net of tax

0 ⁵

Accumulated other comprehensive income balance at the end of the period

95 ⁵

Other comprehensive income, before reclassification, tax benefit (expense)

0

Reclassification from accumulated other comprehensive income, tax (benefit) expense

0

Other

AOCI Including Portion Attributable to Noncontrolling, net of Tax [Roll Forward]

Accumulated other comprehensive income balance at the beginning of the period

(58)

(51)

Other comprehensive gains (losses) before reclassifications, net of tax

0 ¹

5 ²

Reclassifications to net income of previously deferred (gains) losses, net of tax

(3)³

(3)⁴

Total other comprehensive income (loss), net of tax

(3)

2

Accumulated other comprehensive income balance at the end of the period

(61)

(49)

Other comprehensive income, before reclassification, tax benefit (expense)

0

(2)

Reclassification from accumulated other comprehensive income, tax (benefit) expense

$ 0

$ 1

[1] Net of tax benefit (expense) of $0 million, $(2) million, $0 million, $0 million and $(2) million, respectively.

[2] Net of tax benefit (expense) of $(11) million, $1 million, $0 million, $(2) million and $(12) million, respectively.

[3] Net of tax (benefit) expense of $0 million, $1 million, $0 million, $0 million and $1 million, respectively.

[4] Net of tax (benefit) expense of $0 million, $(4) million, $0 million, $1 million and $(3) million, respectively.

[5] The accumulated foreign currency translation adjustment and net investment hedge gains/losses related to an investment in a foreign subsidiary are reclassified to Net income upon sale or upon complete or substantially complete liquidation of the respective entity.

Accumulated Other Comprehensive Income - Reclassification out of AOCI (Details) (USD $)

In Millions, unless otherwise specified

3 Months Ended

Aug. 31, 2015

Aug. 31, 2014

Reclassification out of Accumulated Other Comprehensive Income [Line Items]

Revenues

$ (8,414)

$ (7,982)

Cost of sales

4,419

4,261

Total selling and administrative expense

2,577

2,480

Other (income) expense, net

31

(3)

Total before tax

1,445

1,229

Tax (expense) benefit

(266)

(267)

Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Income

Reclassification out of Accumulated Other Comprehensive Income [Line Items]

NET INCOME

150

(13)

Gain (losses) on cash flow hedges |
Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Income

Reclassification out of Accumulated Other Comprehensive Income [Line Items]

Total before tax

148

(20)

Tax (expense) benefit

(1)

4

NET INCOME

147

(16)

Gain (losses) on cash flow hedges |
Foreign exchange forwards and options |
Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Income

Reclassification out of Accumulated Other Comprehensive Income [Line Items]

Revenues

(43)

(17)

Cost of sales

160

(8)

Total selling and administrative expense

0

Other (income) expense, net

31

5

Other |
Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Income

Reclassification out of Accumulated Other Comprehensive Income [Line Items]

Other (income) expense, net

3

4

Total before tax

3

4

Tax (expense) benefit

0

(1)

NET INCOME

$ 3

Operating Segments - Information by Operating Segments (Detail) (USD $)

In Millions, unless otherwise specified

3 Months Ended

Aug. 31, 2015

Aug. 31, 2014

Segment Reporting, Revenue Reconciling Item [Line Items]

Net Revenue

$ 8,414

$ 7,982

Interest expense (income), net

4

9

Income before income taxes

1,445

1,229

Operating Segments

Segment Reporting, Revenue Reconciling Item [Line Items]

Net Revenue

8,414

7,982

Earnings Before Interest and Taxes

1,449

1,238

Income before income taxes

1,445

1,229

Operating Segments |
NIKE Brand

Segment Reporting, Revenue Reconciling Item [Line Items]

Net Revenue

7,898

7,421

Earnings Before Interest and Taxes

1,625

1,294

Operating Segments |
NIKE Brand |
North America

Segment Reporting, Revenue Reconciling Item [Line Items]

Net Revenue

3,799

3,513

Earnings Before Interest and Taxes

1,042

970

Operating Segments |
NIKE Brand |
Western Europe

Segment Reporting, Revenue Reconciling Item [Line Items]

Net Revenue

1,641

1,713

Earnings Before Interest and Taxes

485

404

Operating Segments |
NIKE Brand |
Central & Eastern Europe

Segment Reporting, Revenue Reconciling Item [Line Items]

Net Revenue

401

393

Earnings Before Interest and Taxes

98

69

Operating Segments |
NIKE Brand |
Greater China

Segment Reporting, Revenue Reconciling Item [Line Items]

Net Revenue

886

679

Earnings Before Interest and Taxes

330

218

Operating Segments |
NIKE Brand |
Japan

Segment Reporting, Revenue Reconciling Item [Line Items]

Net Revenue

179

160

Earnings Before Interest and Taxes

36

11

Operating Segments |
NIKE Brand |
Emerging Markets

Segment Reporting, Revenue Reconciling Item [Line Items]

Net Revenue

966

934

Earnings Before Interest and Taxes

258

156

Operating Segments |
NIKE Brand |
Global Brand Division

Segment Reporting, Revenue Reconciling Item [Line Items]

Net Revenue

26

29

Earnings Before Interest and Taxes

(624)

(534)

Operating Segments |
Converse

Segment Reporting, Revenue Reconciling Item [Line Items]

Net Revenue

555

575

Earnings Before Interest and Taxes

147

186

Operating Segments |
Corporate

Segment Reporting, Revenue Reconciling Item [Line Items]

Net Revenue

(39)

(14)

Earnings Before Interest and Taxes

(323)

(242)

Segment Reconciling Items

Segment Reporting, Revenue Reconciling Item [Line Items]

Interest expense (income), net

$ (4)

$ (9)

Operating Segments - Accounts Receivable Net Inventories and Property Plant and Equipment Net by Operating Segments (Detail) (USD $)

In Millions, unless otherwise specified

Aug. 31, 2015

May 31, 2015

Segment Reporting, Asset Reconciling Item [Line Items]

Accounts receivable, net

$ 3,288

$ 3,358

Inventories

4,414

4,337

Property, Plant and Equipment, net

3,112

3,011

Operating Segments

Segment Reporting, Asset Reconciling Item [Line Items]

Accounts receivable, net

3,288

3,358

Inventories

4,414

4,337

Property, Plant and Equipment, net

3,112

3,011

Operating Segments |
NIKE Brand

Segment Reporting, Asset Reconciling Item [Line Items]

Accounts receivable, net

2,983

3,090

Inventories

4,079

3,978

Property, Plant and Equipment, net

2,232

2,176

Operating Segments |
NIKE Brand |
North America

Segment Reporting, Asset Reconciling Item [Line Items]

Accounts receivable, net

1,570

1,737

Inventories

2,286

2,207

Property, Plant and Equipment, net

643

632

Operating Segments |
NIKE Brand |
Western Europe

Segment Reporting, Asset Reconciling Item [Line Items]

Accounts receivable, net

499

344

Inventories

672

699

Property, Plant and Equipment, net

485

451

Operating Segments |
NIKE Brand |
Central & Eastern Europe

Segment Reporting, Asset Reconciling Item [Line Items]

Accounts receivable, net

249

242

Inventories

139

169

Property, Plant and Equipment, net

45

47

Operating Segments |
NIKE Brand |
Greater China

Segment Reporting, Asset Reconciling Item [Line Items]

Accounts receivable, net

76

84

Inventories

332

249

Property, Plant and Equipment, net

239

254

Operating Segments |
NIKE Brand |
Japan

Segment Reporting, Asset Reconciling Item [Line Items]

Accounts receivable, net

79

134

Inventories

106

94

Property, Plant and Equipment, net

209

205

Operating Segments |
NIKE Brand |
Emerging Markets

Segment Reporting, Asset Reconciling Item [Line Items]

Accounts receivable, net

431

461

Inventories

507

528

Property, Plant and Equipment, net

98

103

Operating Segments |
NIKE Brand |
Global Brand Division

Segment Reporting, Asset Reconciling Item [Line Items]

Accounts receivable, net

79

88

Inventories

37

32

Property, Plant and Equipment, net

513

484

Operating Segments |
Converse

Segment Reporting, Asset Reconciling Item [Line Items]

Accounts receivable, net

288

258

Inventories

223

237

Property, Plant and Equipment, net

116

122

Operating Segments |
Corporate

Segment Reporting, Asset Reconciling Item [Line Items]

Accounts receivable, net

17

10

Inventories

112

122

Property, Plant and Equipment, net

$ 764

$ 713

Commitments and Contingencies - Additional Information (Detail) (USD $)

In Millions, unless otherwise specified

Aug. 31, 2015

Loss Contingencies [Line Items]

Letters of credit outstanding

$ 154

Cole Haan

Loss Contingencies [Line Items]

Maximum exposure under guarantees

$ 21