Good afternoon, everyone. Welcome to Nike’s fiscal 2007 first quarter conference call. For those of you who need to reference today’s press release, you will find it at www.nikebiz.com -- that’s www.nike, n-i-k-e, biz, b-i-z,.com. Leading today’s call will be Pamela Catlett, Vice President of Investor Relations. Before I turn the conference over to Ms. Catlett, please let me remind you that the participants in this call will make forward-looking statements based on current expectations, and those statements are subject to certain risks and uncertainties that could cause the actual results to differ materially. These risks and uncertainties are detailed in the reports filed with the SEC, including Forms 8-K, 10-K, and 10-Q. Some forward-looking statements concern future orders that are not necessarily indicative of changes in total revenues for subsequent periods, due to the mix of futures and at-once order, exchange rate fluctuations, order cancellations and discounts, which may vary significantly from quarter to quarter. In addition, it is important to remember a significant portion of Nike Incorporated’s business includes equipment, most of Nike retail, Nike Golf, Converse, Cole Haan, Nike Bauer Hockey, Hurley and Exeter Brands group are not included in these futures numbers. Finally, our participants may discuss non-GAAP financial measures. A presentation of comparable GAAP measures and quantitative reconciliations can also be found at Nike’s website. This call might also include discussion of non-public financial and statistical information, which is also publicly available on that site, www.nikebiz.com. Now I would like to turn the conference over to Pam Catlett, Vice President of Investor Relations. Please go ahead.

Good afternoon, everyone. Thank you for joining us today to discuss Nike’s fiscal 2007 first quarter results. We issued our results about an hour ago, and as the operator said, you can find them on our website, nikebiz.com, along with the appropriate reconciliations between GAAP and non-GAAP items. Joining us on today’s call will be Nike Inc. CEO, Mark Parker, followed by our Chief Financial Officer, Don Blair, who will give you an in-depth review of our financial results. Finally, you will hear from Charlie Denson, President of the Nike Brand. Following their prepared remarks, we will take your questions. As for questions, just a reminder, we would like to allow as many of you to ask them as possible in the allotted time, so we would appreciate you limiting your initial questions to two. In the event you have additional questions, feel free to re-queue in the event they are not covered by others. Thanks for your help with this, and it is now my pleasure to introduce Nike Inc. CEO, Mark Parker.

Thanks, Pam. Hello, everybody, and thanks for joining us here today. Last time we spoke, we shared the record numbers that Nike posted in FY06. I am happy to say we are off to a solid start in Q1, and Don will share those numbers with you in just a minute. First, I want to thank you today, or talk to you today, I should say, about the things that continue to drive growth and value for our shareholders. The things that we are doing right and a couple of things we can do better. As I said in the last call, my first priority continues to be top-line growth. Nike generates revenue when we put innovative and compelling products into the hands of consumers. That is what we do best. For example, this year’s World Cup, Nike created Joga Bonito. It began as a marketing campaign to reach football crazy fans, and it turned into the world’s largest soccer community. We are already seeing the benefits of that investment. Nike soccer is up nearly 20% over the last 12 months, growing the business to $1.5 billion and making Nike the leading soccer brand in the world. Then there is Nike Plus. When we launched the Nike Plus, it changed running forever. It created a whole new connection between the physical world of running and digital world of content. The response has been great. Just this week, thousands of Nike Plus runners passed the million mile mark on nikeplus.com. That is more than 40 times around the world in less than 10 weeks. We launched Nike Plus in the U.S., Canada, and the U.K., and Australia, and Japan will come online next month. It is an amazing technology that has a huge upside in connecting with consumers and driving revenue.…

Thanks, Mark. On balance, our financial results for the first quarter of fiscal 2007 were as we expected. Our businesses around the world continued to deliver good top-line growth, but difficult gross margin comparisons, demand creation timing, and new accounting for stock options drove earnings per share below prior year levels. At this point, we still expect to deliver solid growth in revenues and earnings per share for the year. Reported revenues for the quarter grew 9% to over $4 billion. Excluding the impact of the weaker dollar, revenues grew 7%, as all three of our product business units and all four of our geographic regions delivered revenue growth for the quarter. As Mark indicated, our overall apparel business was particularly strong, posting 12% growth and adding over $120 million of incremental revenue for the quarter. In addition, the businesses reported as other delivered nearly $100 million of incremental revenue for the quarter, contributing over two points of our overall revenue growth. Futures orders scheduled for delivery from September through January, 2007, grew 6% versus the prior year. Excluding the impact of currency changes, futures orders were up 5.5%. As we expected, earnings per share declined in the first quarter, reflecting lower gross margins, the timing of demand creation spending, and a first-time charge for stock options. The change in accounting for stock options reduced pre-tax income by $61 million, and diluted earnings per share by $0.16. This was partially offset by a $0.03 benefit from a favorable settlement of the previously disclosed Converse arbitration. Consolidated gross margins declined 120 basis points for the quarter, due largely to lower footwear margins. The key drivers were higher air freight, higher discounts, increased product input costs, and changes in product mix. Currency changes had a minimal impact on consolidated gross margins. On…

Thanks, Don, and good afternoon, everyone. As Don just said, we are off to a solid start for the Nike brand as well in fiscal year 2007. We have completed another successful first quarter and, given the fact that it is one of our largest, we have set a great tone for the balance of this fiscal year. Even so, this year feels a lot like it did last year at this time. Questions about the near-term future and our ability to navigate, rising raw material costs, currency fluctuations and yes, even an increasing uncertainty around consumer spending. This is the world we compete in. It is a dynamic global market driven by a set of diverse internal and external forces. That is what makes it so energizing and so rewarding. I have even more confidence this year that we will continue to deliver results and build the brand of business toward our long-term growth objectives. We will continue to win by delivering innovative products, maintaining close connections to consumers and a strong, distinct presence at retail. In first quarter 2007, we faced down a number of challenges. We remain focused on our consumers, and the Nike brand added $230 million in revenue for the quarter. We grew in every single region in which we compete and across key categories, like football, sport culture, women's fitness, and basketball. Don has given you the highlights that drove these results. Today, I would like to talk to you about some of the things we believe will deliver continued growth for our business worldwide. I have addressed some of our challenges over the last couple of quarters in two of our major markets, western Europe and Japan. We posted a small revenue gain for the first quarter in Japan, and I am sticking…

We'll take our first question from Omar Saad - Credit Suisse.

I wanted to ask a question about how your performance has been -- you've obviously demonstrated significant consistent top line growth over the last several quarters. I was hoping you could break it down a little bit by channel. Don had mentioned I think a plus 9 number in the retail business. Which channels are performing the best for you when you compare sporting goods versus athletic specialty versus department stores and where do you see the most growth from in the future? Charlie Denson: Well, I think it varies around the world. Obviously the distribution channels are a little differently based as far as priority and dominance around the world. Sporting goods has continued to perform very well as a channel for us across the landscape and pretty much around the world as we continue to look at our category deliverables. The mall of the U.S. is a challenging environment today as we have all talked about. That has been an area where we feel that it is still a great opportunity for us to continue to grow, and we're focused on that as we speak. Some of the other channels of distribution, family footwear and the department stores have been strong performers for us as well. Again, I think as you think about one of the most influential areas that lead the marketplace is what we call our energy account. I feel very good about the way we sit right now, whether it is here in the United States, in parts of Europe, or coming out of Japan. So hopefully that answers most of your questions.

That's helpful. A follow-up. If you could elaborate a little bit while we're talking about channels, the mass channel and maybe give us a little of an update on how the Starter business is coming along. Thanks.

The value opportunity for Nike, our primary driver there is going to be Exeter or Starter group, and the business in that channel for us working with Starter in the first quarter is up, and we expect that to be up through the year. We are in the stages of trying to sort out our best strategy going forward. We are taking the licensed business and bringing that in-house and going more direct in that sense, and we think that's the model that we're going to be leaning on going forward. We're actually bullish. I don't think this year we're going to see dramatic increases in that channel for Nike, but as we move forward over the next two or three years I think you will see the performance there really start to make a big difference.

Thank you.

Next we'll hear from Virginia Genereux - Merrill Lynch. Virginia Genereux - Merrill Lynch: Thank you. Charlie, I might have missed it in your commentary. Can you give us an update on your expectations for Europe and France and the U.K. sort of remaining tough. When does the situation get better there? Charlie Denson: Yes. Virginia, I think most of Europe is performing very well, and I think I talked that ex-U.K., the European business would be up double digits, so we feel pretty good about the overall level of business in Europe. I think that I hit it in my commentary a little bit in the sense that we feel pretty good about where France is, and we're starting to see some of the right signs coming out of the French marketplace and some of the numbers as we look to the second half of the fiscal year. The U.K. is still a very, very tough marketplace and a challenging marketplace, and I think we're going to continue to do the tough work that we need to do there around product and distribution and brand presentation, and I touched on those as well, but it is going to be awhile for the U.K., so I am not too optimistic that we're going to see a whole lot of improvement through this fiscal year. Virginia Genereux - Merrill Lynch: Is the backlog and the pace of revenue this quarter 1% constant dollars? I hear you're growing strongly every place else. Is Europe a low single-digit grower constant currencies until the U.K. rights itself? Or I know France is big. That's what I am sort of getting at. Charlie Denson: I am not going to go out on a limb and start predicting futures numbers quite frankly, but for now we're going to keep doing the work, and we think we're doing the right work. I guess that's the most important thing to say and that when we get through some of this stuff, we're going to be in a lot better position, and you've been around awhile. You know what happens when we get through some of this stuff and we get ourselves focused on the consumer again and really attack. So I am really bullish on the European marketplace overall long term. We have got a little bit of work to do in a couple key markets. Virginia Genereux - Merrill Lynch: Understood. Secondly, Don, for you, can you just remind us, I mean the margin expansion at other brands was huge, that doesn't even include the Converse reversal. But when did you reposition Bauer and how long did that take you?

We've essentially been on the repositioning of the brand probably about two quarters, which as you note is a combined Nike and Bauer brand, and we've essentially got a full innovation pipeline. We've got some new product activity coming out and doing some cross-promotional work between Nike and Bauer in Canada, and it has been very successful so far. Virginia Genereux - Merrill Lynch: Great. Thank you, guys.

Our next question will come from Margaret Mager – Goldman Sachs.

Nice quarter overall. I have a couple questions. First of all, with regard to the sports culture business, a 25% increase, was that just -- or 28% overall, 25% in Metro. Can you talk a little bit about the whole lineup of product that you would categorize as sports culture? Because one of the biggest things we hear about Nike is you're not on trend as far as low profile go, and it seems to be one of the biggest concerns out there. So I would love to hear you run through how do you think about what low profile is and what is your lineup of product there? Then the other question I have is on gross margin. Don, I think you said when you went through the outlook for the year this year that you would expect gross margin to be flat to down slightly where as last quarter I think you said essentially in line with last year. So what is the main thing that's changed in that outlook and if you could talk about the pieces you outlined on gross margin, air freight, discounts, input costs, and mix all affecting it, which of those would be the greatest impact? Thanks.

Sure. As I said and Charlie mentioned as well, we are very pleased with the performance of our sport culture business overall, not just the Metro piece. The Metro piece, by the way, the first quarter of this year is up 250% for the quarter. And then an overall increase of 28%. That being said, it is a multi-dimensional business for us, Metro is what we call low profile, is the one we've been a little bit late to the party with as Charlie mentioned, but I think our performance over these last two to three years we're very proud of. In fact, we've doubled every year. This year we expect it to be $400 million, at least in that realm. So we feel like we are actually putting relevant trend-right product out there, and the response has been tremendous, the sell-through very strong, particularly in Europe where the appetite for that product is greatest. But Metro is one piece of that, and we're going to continue to stay very focused on that. I think you'll see the other pieces of our business on the sport culture side is Urban. We call Urban, which you're very familiar with, Indy and then sport-inspired. We have really four different dimensions of sport culture product. We're seeing actually strong performance across those segments for Nike, and not just across the segments but up and down the price spectrum. There is a lot of talk about the higher price points, getting softer. We're not seeing that. We're seeing actually performance and even sport culture product at those higher price points actually selling through quite well, selling in and selling through. The urban business we're actually very bullish on. Charlie mentioned the Air Force 25 coming out along with the year of the Air Force One, some incredible products and concepts and marketing around that that we're real excited about. We think that will bring even more energy. I think one other thing that a lot of people don't realize but I think is worth mentioning is that the appetite for sport culture product, particularly the Metro product which is lower profile and more tailored is actually influencing some of the performance products as well. I think you will see some of the appetite for that type of styling and that type of product being echoed on the performance side of the business and the appetite for that product actually going up quite a bit. So you will see some pretty interesting things from Nike on that front over the next three quarters.

Cool. Thanks.

Margaret, to your second point, the margin year-over-year change is really a footwear story, and as I indicated in the prepared remarks, the key drivers are macro economic factors which are things like oil and labor costs partially offset by some of the things we're doing around lean, some higher discounts, principally in the U.K. and in Japan, higher air freight. We've talked about that before, really related to the demand curve around air product. And then finally some mix changes both in terms of product mix as well as regional mix. In terms of those factors, the ones I would say that have evolved a little bit in terms of what we've seen is really around the discount, the promotional environment has been a little heavier, not a lot, but a little heavier than what we had expected earlier in the year. Certainly the mix has evolved a little differently. When I am talking about changes here, they're actually not large changes, most of this was consistent with what it is we expected. As I said earlier, we do expect this to get a little bit better over the balance of the year. We think we're going to see better capacity situation around the air product, so we expect the air freight numbers to go down, and certainly we expect some of the promotional discounts to ease off a little bit as well.

When you say the mix by product and region, does that mean that because the U.S. has been so strong, is that a slight negative in terms of mix on gross margin or if you could elaborate there? And discounts, Don, does that mean discounts in like Nike Town, your own stores, or is that to your customers?

No. The answer to your first question is yes. Regional mix is a piece of the puzzle, and the U.S. growth, the U.S. is a little bit lower than some of the other regions in terms of gross margins. So that tends to move the margin at an aggregate level down a little bit. When I talk about a promotional environment and heavier discounts, it is to our customers, not in Nike Town.

Thanks for that and good luck in the next three quarters. You're off to a good start.

Next we'll hear from Robbie Ohmes - Banc of America Securities. Robbie Ohmes - Banc of America Securities: Thanks. A question for Charlie and maybe Mark as well. Can you guys give us a little more detail around that reorganization that you recently announced with the promotion to Gary DeStefano and Craig Cheek with the five product segments? Where are you at filling those positions and what prompted this re-org and what should we expect to happen the next couple of years because of it? Thanks. Charlie Denson: Thanks, Robbie. I will talk about the why first, because I think that's probably the most important piece of the puzzle. As we continue to grow our business and build the brand around the world, one of the things that we've become more and more aware of over the last five years with the success that we've had, that we are operating in a very, very complex multi-dimensional business environment, and one of the things that we feel very strongly about and have come to the conclusion is that we can do a much better job continuing to grow the business by breaking it down into smaller pieces and getting more focused and deeper involvement and connectivity with key groups of consumers. We've looked at it many different ways, and we feel that the category approach is the best way to get after this thing, and so that's really the why, in a nutshell. As far as where we're at on this, we haven't made the structural announcements with Trevor Edwards and Gary moving into different roles as well as Craig Cheek and Jacques [Legado], and we are in the process of filling the category leadership roles which we will start to announce. I don't expect to get them all filled at the same time, but I would expect to start announcing those in the very near future as we move ahead into this line formation and operating organization. So I think the other piece that I would just say to call out is that it helps us take advantage of the relationship between performance and sport culture which you've heard us talk a lot about, and that we would also expect not to give up our core competencies around innovation and product creation by product type being footwear apparel and/or equipment. So we're very excited about this, and I am personally spending quite a bit of time in the zone myself these days.

I can vouch for that. Let me just weigh in on that, too. Because I think this is a big ,deal actually, for Nike. We have taken steps in this direction and other parts of our business, and we've seen great success here. We're really building on what's working and trying to scale that. A great examples is Air Jordan, Nike Golf, soccer, I mentioned skate in my remarks, and then women's fitness. These are all areas where we've actually taken this type of step toward getting more integrated and aligned by consumer segment, by category. The insights we pick up and the connection to the consumer in the marketplace and our ability to differentiated the marketplace really goes to a whole different level. This is an absolutely essential key strategy for Nike to grow the marketplace and segment the marketplace and one that we're really excited about. So you will see that really taking shape and making a real difference here in the quarters ahead. Robbie Ohmes - Banc of America Securities: I am assuming it is all internal promos I assume for this, right? Charlie Denson: I think it is going to be a series of both. It is a great opportunity for the organization because I think to the point our intent is to segment and grow the marketplace and the businesses that we've defined, it also plays out internally as well. So we would expect to look outside as well as internally as we start to fill out this organization. Robbie Ohmes - Banc of America Securities: Just a follow-up on this, as you look to do this reorganization, was there a specific area that you feel you missed over the last couple of years that prompted this? Was it sport culture, feeling like you missed some trends there that caused this or what can you point to as the catalyst? Charlie Denson: Well I think it was exactly what Mark just said. We're building on what's been working in the areas that we've seen the most success, and sport culture was another piece of the puzzle that we actually started to put in place when we named Sandy Bodecker to lead that effort and started to fill out that organization as well. Robbie Ohmes - Banc of America Securities: Thanks a lot, guys. Pam Catlett: Thanks, Robbie.

Our next question is from John Shanley - Susquehanna Financial.

Thank you and good evening, folks. Charlie, you gave us a good rundown in terms of the some of the markets in Europe. I wonder if you could just touch base on Japan briefly? Do you feel you have turned the corner in the Japanese market with sales up 2% in the quarter? And is Japan still your largest market in Asia or has it been supplemented by China now? Charlie Denson: Japan is still the largest market and still very influential not only in Asia but obviously around the world, and as I said in the prepared remarks, I am not ready to declare victory yet. We're still working pretty hard. We've got a new management team in place for the most part. I was out there about three or four weeks ago, and I am guardedly optimistic but very excited about some of the things that we're working on. I really believe that, like I said I am sticking to my outlook as far as the work that's being done that we're going to start to see some results. Again, we're not looking for just a 2% increase here. We're looking to get back on track.

Do you think the results will occur in fiscal '07 or is it going to take longer than that in Japan? Charlie Denson: I think momentum is going to start to build. We are going to start to see all the right signs and we'll be able to talk more confidently about it in the back half of '07. When the results actually start to kick in, we'll probably be a lot smarter six months from now.

Sure. Then either Charlie or Don, first quarter of the current year marked again the third consecutive quarter where you've had a double-digit increase in inventories and a single-digit increase in sales, and I know you said the quality of that inventory is good and there is not that much closeout merchandise, but it seems like something is out of balance in terms of your inventory. Is there a point where you may have to cut that inventory level to bring it more in balance with your sales growth and if so, when would at that occur?

Well, I think, John, just to clarify, both comments that Charlie made and I made, we would like to see inventories over time be lower in terms of the growth rate, and we are confident that they're going to be there towards the back end of the year. But we have made some operational decisions this year which are driving the inventory increases, and we're pretty comfortable with those decisions. As I said on my remarks, we had some higher in-transits driven by some decisions around earlier ordering to improve deliveries. We've got some changes in the business model and in the areas where we do have a little bit of a slowdown -- we talked about the U.K. and Japan -- we think we've got the right plans in place. As I said earlier, we do expect to see some easing of the growth rate in the back half of the year.

In inventories?

In inventories.

You think they could be brought into balance by the back half in terms of the sales growth that you are anticipating?

Well, I don't want to make a specific prediction at this stage. We definitely think the growth rate is going to come down, and we're still sticking to our high single digit target of revenue growth for the year.

Okay. Fair enough. Charlie Denson: John, I would just add one thing, too, and I mentioned it in my remarks as well and that was the piece around we're watching the retail inventories as well, and I think the closeout number that we reported down 6% is indicative of where we're at in the overall marketplace. I feel pretty confident that we would not have seen the year-on-year improvement for the quarter had we not taken some of the steps that Don outlined.

Maybe it would help us a little bit, Charlie, if you could kind of give us some insight in terms of where the heaviest portion of the inventory build is. Is it in Europe? Is it in the U.S.? Where is it and maybe we can basically work it back into our own assumptions of what's going on in the marketplace if we knew where the inventory was located. Charlie Denson: Well, I think Don called out where the areas were where we've seen slowdowns. Again, the inventory is spread around the world for the different reasons that we talked about, and then the slowdowns that were on it I think are the areas that Don has outlined.

John, I am going to weigh in, too. I just wanted to emphasize a couple things here on inventory. One is that the management of our inventory is one of the most fundamental drivers of excellence, and rest assured we know that. This is high on my radar, and everyone else's around here. We've actually torn this down, just as you've heard in some of the remarks up front, and we're confident that there is real solid operating decisions that are really affecting this growth. Again, I think we look forward to checking this one off by year end as yet another commitment that we have made. Rest assured we are very focused on this.

Great to hear. Thank you again, guys. Charlie Denson: Thanks, John.

Next we'll here from Bob Drbul - Lehman Brothers.

I guess the first question that I have is Mark, could you elaborate a little bit more around specifics in terms of the concerns that are out there around the health of the industry and the market? The second question I have is futures related and specifically in the U.S. Can you talk a little bit about the split of footwear versus apparel and then the trend of futures going into the quarter, maybe the first half of the period and the second half of the period?

Yes. Just on the question on the health of the industry, I think there is always lots of concerns. We've lived through lots of these up's and down's within the industry. There's a lot of external factors that are creating some concern, economic pressures, pressures on pricing, bifurcation of the market around the world. The split between premium and value, for example. Some consolidation going on at different markets. We feel, though, that our position here is one of strength because we are diversifying our portfolio. I have often said one of our key strategies is complete offense, and I have referred to that in terms of footwear and price points up and down the price point spectrum. It is a much bigger strategy for us in terms of sport performance, sport culture, and the sport categories. We really feel that we are in a much better position to pull the levers across the spectrum of the business that we do to really grow the marketplace. We're seeing some challenges here in the U.S. Charlie mentioned the athletic specialty, the differentiation that needs to take place in the mall business. We are on that, working very closely with Foot Locker and Finish Line, our two biggest accounts there, and feel like we have some plans to get that to a better place. There has been a lot of speculation on the higher price point products. We're not seeing those indications as much as we're hearing speculation from the analyst groups out there. We feel that there is a healthy appetite both on the sport performance and the sport culture side of the business, so we're actually working those levers and making sure that as I said before, the changes that are taking place in terms of sport culture product that has made that more appetizing to consumers, some of that can influence the performance product as well. We are making those changes and we're seeing some great acceptance from consumers and retailers out there. We feel like we're in a good position to manage through some of these challenges in the marketplace, and feel like the rest of this fiscal year will be improving our position and bringing some real energy and leadership to the marketplace. Charlie Denson: Bob, your question on futures, both are balanced. Footwear and apparel in the U.S., front, back half window globally are pretty balanced.

Great. And the overall trend? The overall trend, is it consistent throughout the business? Charlie Denson: I am sorry, I don't understand that question.

On the global side of it and within the U.S., the first half of the order period versus the second, did it tail off at all or did it gain momentum? Charlie Denson: The first half and back half of the window are balanced.

Thank you very much. Pam Catlett: Thanks, Bob.

We'll hear next from Jeffrey Edelman - UBS.

Thank you. Good afternoon. Don, a question for you on the gross margins. As we think about your business and the seasonality of it, all of this talk about comparisons has been versus the prior year, but you've really shown several quarters now of steady improvement quarter to quarter. Is that not a more appropriate way to look at your business? If so and that we think about some of the positives you'll have going forward less air shipping, a little more supply chain, couldn't we see the possibility of some steady further improvement quarter to quarter?

Well, Jeff, there are a couple of points I would make here. One is there is a seasonal pattern to our gross margins. However, that seasonal pattern has been doing some flattening over the last few years, but there still is a bit of a seasonal pattern. That's one of the reasons why we do speak to this on a year-over-year basis. But your point, which I think is very well taken, is there has been sequential improvement in the margins, and we do expect to see improvement sequentially in the next few quarters. You've called out very accurately what some of the drivers are going to be. We don't think the air freight numbers are going to be as high as we look at the back half. We expect to see some improvement in mix, and we think some of the discounting is going to be a little bit better. Our comparisons, frankly, get a little bit easier in the back half of the year. For all of those reasons we think the year-over-year changes are going to be improved over the back half of the year, and I think you will see that sequentially.

Great. Thank you. And then just a second question on demand creation. Can we assume demand creation as a percentage of sales would be similar to what it was last year? Will it continue to ratchet up?

If you think about our longer term model, Jeff, it has been that we grow demand creation at roughly the rate of revenue growth, and I think that's a reasonable assumption, overall we do expect to get SG&A leverage for this year excluding the option charge. So if you look at demand creation and operating overhead excluding the option charge, we are still targeting to get leverage for the full year.

Okay. Great. Thank you. Pam Catlett: Thanks, Jeff. We have time for one more person.

Great. Our next question comes from Kate McShane - Citigroup.

Hi, thank you. In regards to demand creation, I think there was a comment that demand creation would be higher in Q2 and you flagged Nike Pro and Nike Plus. With Nike Pro what will be you doing differently this upcoming quarter than in the past? With Nike Plus I assume the demand creation is for the further roll out internationally?

Yes. I am just going to clarify something and then hand it off to Charlie to give you the answer. There are three factors really driving demand creation. It is those two you mentioned plus we still have Nike Air marketing in the second quarter, so there is really three major thrusts to the demand creation. Charlie Denson: Breaking down the two that you mentioned, Nike Pro and Nike Plus, Nike Pro will be the centerpiece of the European holiday campaign, and we're pretty excited about that pretty much being focused on the world of football or soccer, and so you will see a significant campaign in Europe around Nike Pro, as well as a continued effort here in the United States both at retail and through some of the marketing and advertising that you've seen in the early fall. Nike Plus will be both a rollout into Western Europe and Japan and then you will also see, because of such a strong response that we've had here in the United States, we're actually going to amp up that a little bit more as we go into the holiday gift buying period.

Okay. Thanks very much. Pam Catlett: Thank you. Thanks, everyone, for joining us, and we look forward to speaking with you soon.

That does conclude today's conference. We thank you for your participation. You may now disconnect.