June 10, 2025 — Nike, the world’s largest sportswear company, reported a significant drop in global sales last quarter, signaling deepening challenges as consumer preferences shift and competition intensifies.
The company announced a 9% decline in worldwide revenue, with its critical China market plummeting 17% and North America—its largest region—falling 9%. Despite the disappointing figures, Nike’s stock (NKE) rose 4% in after-hours trading Thursday, as results slightly exceeded Wall Street’s grim expectations. Over the past year, however, Nike’s shares have dropped roughly 30%, reflecting investor concerns.
Market Pressures and Changing Trends
Nike faces a dual challenge: a broader consumer pullback on discretionary spending and rising competition from niche brands like Hoka and On, which have gained traction with runners seeking alternatives to traditional athletic giants. Analysts note shoppers are prioritizing budget-friendly basics over premium sneakers and performance apparel, squeezing Nike’s core offerings.
Strategic Overhauls and Course Corrections
In response, Nike is reducing supplies of legacy products like the Air Force 1 and Pegasus lines to reignite demand and curb discounting. The company is also steering customers toward newer, higher-margin releases like updated Air Max and Pegasus models.
Nike’s push to direct-to-consumer (DTC) sales—scaling back wholesale partnerships with retailers like DSW—backfired, leading to lost shelf space and revenue. The company has since renewed some third-party ties, acknowledging the misstep.
“Nike overcorrected and underestimated the role of wholesale partners,” said Neil Saunders, GlobalData Retail analyst, in a June note.
Leadership and Brand Collaborations
New CEO Elliott Hill, a Nike veteran reappointed last year, is banking on high-profile collaborations to revive growth. A Nike x Skims line—developed with Kim Kardashian’s shapewear brand and targeting women—will debut in the U.S. this spring, signaling a bid to tap into the booming athleisure market.
As Nike navigates its slump, analysts warn that turnaround efforts may take quarters, with macroeconomic headwinds adding uncertainty. The company is expected to outline further restructuring plans in upcoming earnings calls.
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