Q1 was another strong quarter for NIKE with revenue growth of 16%.
And even as we saw physical retail traffic return across much of the portfolio, digital continued its momentum with 25% currency-neutral growth led by North America at over 40%.
Over the past 18 months, we've demonstrated our ability to manage through turbulence to emerge even stronger and better positioned.
And moments like these are exciting for our company because sport energizes our roughly 75,000 employees around the world.
If NIKE were a country, we would have eclipsed the competition, capturing 226 medals, including 85 golds.
The film saw more than 800 million impressions across all channels as more than half of EMEA's Gen Z population viewed it at least once.
Days later, we released Giannis' latest signature shoe, the Zoom Freak 3, which is built to support the dominant physicality that defines his style of play.
So far this fall, we've seen sell-through in our kids business up almost 30%, led by digital with growth of almost 70.
At over 750,000 square feet, this new home for our innovation teams is five times the size of our previous lab and is continued proof of NIKE's leadership in sports science.
We're seeing strong over indexing growth of 16% in this key growth driver.
So today, one year after that initial launch, there are more than 43 styles using Space Hippie innovations across four sports, three brands and our full consumer construct.
For instance, you could see it come to life and iconic franchises such as the Air Force 1 Crater.
Our digital growth is led by outsized member buying, which has seen a penetration increase of 14 points since last year.
And we're seeing this come to life as repeat buying members grew more than 70% in the quarter.
for example, 90% of the invitees for the Off-White Dunk went to members who have lost out on a prior Off-White collaboration over the past two years.
This quarter our inline fleet grew over 70% in revenue approaching pre-pandemic levels.
Our relentless focus on serving the consumer translated into revenue growth of 16% and EBIT growth of 22% versus the prior year.
Sneakers has increasingly become an indicator and barometer of brand heat, now being operational at scale in 50 countries around the world.
NIKE Digital is now 21% of total NIKE brand revenue, which is an increase of 2 points versus last year, with strong double-digit growth versus the prior year even with broad reopening of physical retail.
Digital is increasingly becoming a part of everyone's shopping journey and we are well positioned to reach our vision of a 40% owned digital business by fiscal '25.
This quarter, we exceeded our 65% full price sales realization goal, which reflects the expectations that we put forward at our last Investor Day.
This quarter Express Lane grew roughly 20% versus the prior year and it increased its share of overall business.
NIKE Inc revenue grew 16% and 12% on a currency neutral basis with growth across all marketplace channels.
NIKE Digital grew 25% and NIKE owned stores grew 24%.
Wholesale grew 5% in the quarter, negatively impacted by lower available inventory supply due to worsening transit times.
Gross margin increased 170 basis points versus the prior year, driven primarily by higher NIKE Direct margins and partially offset by increased ocean freight surcharges.
SG&A grew 20% versus the prior year.
Our effective tax rate for the quarter was 11% compared to 11.5% for the same period last year.
First quarter diluted earnings per share was $1.16, up 22% versus the prior year.
In North America, Q1 revenue grew 15% and EBIT grew 10%.
NIKE Direct grew more than 45% with NIKE Digital now representing 26% share of business.
Digital continued its momentum and grew more than 40%, increasing market share by outperforming industry trends with strong growth in traffic and repeat buying member activity.
The return to physical retail accelerated NIKE owned store growth of over 50% as we served members with elevated experiences.
NIKE owned inventory increased 12% versus the prior year.
In EMEA, Q1 revenue grew 8% on a currency neutral basis and EBIT grew 26% on a reported basis.
NIKE Direct grew 10% on a currency neutral basis, led by our NIKE owned stores.
In EMEA, while NIKE Digital grew 2% in the quarter, demand for full-priced products grew nearly 30% as we compared to higher liquidation levels in the prior year.
NIKE owned inventory declined 14% on a reported basis with closeout inventory down double-digits.
Transit times to EMEA have also deteriorated over the past 90 days, causing higher levels of in-transit inventory and negatively impacting product availability to serve strong consumer demand.
In Greater China, Q1 revenue grew 1% on a currency neutral basis, EBIT grew 2% on a reported basis as the team delivered in line with our own recovery expectations.
This campaign generated over $1 billion local views, demonstrating strong brand connection with Chinese consumers.
NIKE Direct declined 3% on a currency neutral basis, partially impacted by retail closures.
NIKE Digital declined 6% as we compare to higher liquidation in the prior year, partially offset by double-digit improvement in full price sales mix.
We experienced a strong 6.18 consumer moment where we grew nearly 10% versus the prior year and remained the number one sports brand on Tmall.
Demand in our SNKRS app grew more than 130% for the quarter.
First quarter revenue grew 31% on a currency neutral basis and EBIT grew 72% on a reported basis.
NIKE Digital grew more than 60% on a currency neutral basis, highlighted by the expansion of our NIKE app.
in June, the app went live in Mexico and six additional countries across Southeast Asia generating 3 million local downloads during the quarter.
This collaboration drove more than half of day 1 sales and highlights how digital and physical experiences are converging in our own stores, leveraging local insights and a more agile supply model.
Therefore, we're revising our short-term financial outlook to incorporate the following factors: 10 weeks of production already lost in Vietnam since mid July.
We still expect gross margin to expand 125 basis points versus the prior year, at the low end of our prior guidance, reflecting stronger than expected full price realization, the ongoing shift to our more profitable NIKE Direct business and price increases in the second half.
This more than offsets roughly 100 basis points of additional transportation, logistics and airfreight costs to move inventory in this dynamic environment.
We also expect a lower foreign exchange benefit now estimated to be a tailwind of roughly 60 basis points.

Summary:
And even as we saw physical retail traffic return across much of the portfolio, digital continued its momentum with 25% currency-neutral growth led by North America at over 40%.
NIKE Digital grew 25% and NIKE owned stores grew 24%.
Gross margin increased 170 basis points versus the prior year, driven primarily by higher NIKE Direct margins and partially offset by increased ocean freight surcharges.
First quarter diluted earnings per share was $1.16, up 22% versus the prior year.
NIKE owned inventory increased 12% versus the prior year.