Nike Stock Fall, Anticipating Revenue Dip on Weak Demand

On Thursday, Nike stock declined, and it disclosed an expected fiscal 2025 revenue drop due to fluctuating demand for its sneakers as customers desired newer brands.

In the after-hours trading session, the firm experienced a -12.36% plummet to $82.55 per stock, an unexpected slide that surprised the company.

According to reports, Nike anticipates a mid-single-digit percentage down in annual revenue, with fourth-quarter earnings missing estimates. However, analysts forecasted a 0.91% surge.

Moreover, the shoes and clothing apparel stock, which has plummeted by -13.00% in 2024, will lose more than $15.00 billion in market value if the losses continue until Friday.

Meanwhile, Nike’s efforts to drive more sales through its direct-to-customer medium in North America have been failing, as customers have become picky about their spending.

Furthermore, the Air Jordan maker’s competitor brands, On and Deckers’ Hoka, have aggressively seized some of the firm’s market share with their more fashionable products, intensifying the industry’s competition.

In the post-trading session, these two firms’ shares declined between -1.00% and -2.00%, respectively.

Meanwhile, Nike has reduced its inventory of oversupplied brands like Air Force 1 to counteract a worsening slide in sales.

It also invested in enhancing running shoes with improved midfoot cushioning for better stability and is planning to release a new version of the famous Air Max line.

Olympics Paris 2024 Looms, Nike Willing to Invest More

Nike has revealed it will spend more on this Summer Olympics Paris 2024 than any previous Games.

John Donahoe, CEO of a prominent shoe and apparel company, stated that the Paris Olympics present a unique opportunity for the firm to share its vision of sport with the world. This will be achieved through groundbreaking innovation and an unmissable brand campaign.

He also said that Nike was refocusing its vision of sport at the center of everything it does, which serves the athlete.

According to reports, the Air Jordan maker’s Q4 revenue in its wholesale business surged by 5.00%. However, its direct-to-customer business growth declined by -8.00%.

Moreover, Nike’s fourth-quarter revenue plummeted by -1.7% to $12.61 billion, missing estimates of $12.84 billion.