Over the past several decades, Nike has established itself as an absolute giant in the sportswear market and has become one of the most iconic and recognizable brands on the entire planet. But the company dealt with some absolutely horrible financial news on Monday morning.
According to a report from Matthew Kish of The Oregonian, Nike saw an absolutely historic drop in its stock price on Friday as a result of news that the company was expected to see a decline in sales in the new fiscal year.
“Nike shares on Friday tumbled nearly 20% after the company said it expected sales to decline in its new fiscal year, the latest sign of severe turbulence at Oregon’s biggest company,” Kish wrote on Monday morning.
“It was the biggest one-day drop in Nike history, wiping out roughly $28 billion in shareholder wealth.”
But the news is even more dire than that as Kish points out that this isn’t just a one-day blip, the stock price has actually been falling consistently for several years.
“Even before Friday’s tumble, Nike’s stock had been heading steadily downward after climbing above $170 in November 2021. Shares closed Friday at $75.36,” Kish wrote.
Needless to say, this is horrible news for Nike and it led to a lot of reactions on social media as a result.
Brooks, Asics, Hoka etc >>>>>> Nike. I haven’t bought anything Nike in years minus a Chiefs or Mizzou shirt with a small nike logo on it somewhere.
— LoneRider (@lonerider____) July 1, 2024
I stopped buying that crap over 20yrs ago.
— Jim (@Bet_TheSpread2) July 1, 2024
Adidas >>> Nike
— Salty Sarsparilla (@SaltySarsparill) July 1, 2024
Asics are better
— Ricky (@CoolPapaRick) July 1, 2024
Nike shareholders and executives watching their stock absolutely plummet
while Phil Knight is throwing hundreds of millions at Oregon to still not win any natties pic.twitter.com/BTj5ZNxI4s— Digital DAM 🦫 (@TheDigitalDam) June 28, 2024
$NIKE down 20% on friday after a major earnings flop, surprising 10% decline in revenues for the quarter.
NIKE also projects declining sales for 2025.
Worst day in history for NIKE stock since its IPO in 1980
Might be a warning shot for more consumer brands facing inflationary… pic.twitter.com/JI0SeLcsB2
— Eddie (@eddietradezz) June 29, 2024
The decline in sales and subsequent stock price dip appears to be a result of Nike betting big on its classic shoes and direct sales instead of innovation and wholesale. Clearly, it’s not working for the iconic brand.
About Kevin Harrish