Nike is cutting jobs for the third time this year as sales slump, anticipating a revenue decline between 7 and 9 percent next year according to financial reports cited by nos.nl. The sportswear giant is grappling with sliding international sales, the departure of high-profile athletes to rival brands, and the fallout from previous retail strategies that strained relationships with independent shop owners.
Elliot Hill faces revenue declines in China
Chief Executive Elliot Hill was brought out of retirement in 2024 to right the company’s trajectory, but the turnaround faces steep hurdles. The brand lost French football star Kylian Mbappé to Swiss competitor On, while Asian markets show sharp declines. Revenues in China dropped 22 percent last quarter compared to the same period in the previous year, according to financial disclosures.
Retail Strategy Friction
Industry specialist Dave Quadvlieg points to past strategic choices as a primary driver of the current slump. Nike previously pivoted toward operating its own stores and pushing online sales to secure direct consumer relationships, placing strict inventory demands on independent retailers. A football shop was not allowed to buy the newest shoes, for example, because Nike preferred to sell those top models itself,
Quadvlieg explained to nos.nl.
Independent shops pushed back against these restrictions by reducing their orders of Nike footwear. While online shopping thrived during the pandemic, physical store shelves filled with competing brands once retail locations reopened. Sneaker collector Thomas van Vliet noted that limiting distribution to smaller shops eroded the brand’s hype and connection to consumers.
New Balance and Hoka capture Nike market share
Emerging athletic brands are capitalizing on Nike’s missteps. Competitors like On, New Balance, and Hoka have captured market share by avoiding the dominant positioning that alienated traditional retailers. Skechers secured a contract with English striker Harry Kane, breaking the historical monopoly held by brands like Nike and Adidas. In China, domestic brands Anta and Li-Ning are adding further pressure, while consumer shifts toward alternatives are compounded by perceived drops in product quality in recent years, according to Van Vliet.
Nike hires Elliot Hill as revenue forecasts drop
When did Nike bring Elliot Hill out of retirement?
Nike brought Elliot Hill back from retirement in 2024 to take over leadership of the company.
Which brands signed deals with prominent football figures away from Nike?
Kylian Mbappé moved to the Swiss brand On, and Harry Kane signed an endorsement contract with Skechers.
What specific sales drop does Nike forecast for next year?
The company anticipates a total revenue decrease of between 7 and 9 percent for the upcoming year.
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