What's gone wrong at Nike? How the world's sportswear giant lost its mojo
Source: BBC Business ↗
Nike’s recent earnings reveal that the sportswear giant is finally seeing the early effects of a turnaround plan spearheaded by veteran Elliott Hill, who was coaxed out of retirement two years ago to revive the brand. The plan is beginning to lift sales, but progress is slow, and the company’s woes were underscored last week when football superstar Kylian Mbappé ended a 20‑year partnership with Nike to join Swiss up‑and‑comer On. Mbappé’s departure, alongside World Cup winner Lamine Yamal’s move to Adidas, raises doubts about Nike’s ability to remain the premier logo for elite athletes and the fans who idolise them, especially after the brand’s share price has slumped 75 % over five years and it was dropped from the S&P 100 index.
Analysts trace Nike’s decline to a series of self‑inflicted strategic errors that began under former CEO John Donahoe, the ex‑eBay chief who pushed a direct‑to‑consumer, digital‑first model. While the shift initially boosted sales during pandemic lockdowns, it later diverted research and development funds away from product innovation and made limited‑edition shoes too widely available, diluting their appeal. The resulting loss of product excitement allowed newer brands such as On and Hoka to capture shelf space that Nike once dominated, especially in key overseas markets like China where demand weakened. The company’s over‑reliance on digital sales also left it vulnerable to cost‑of‑living pressures that curbed consumer spending, prompting cost‑cutting measures and redundancies that further eroded its market position.
Despite the setbacks, Nike still commands a powerful roster of athletes—from Rory McIlroy to Vinícius Júnior—and retains historic partnerships with figures like Michael Jordan, Serena Williams and Cristiano Ronaldo. Hill emphasized during the earnings call that the brand remains “great” and wishes Mbappé success, while industry veteran Matt Powell cautioned that Nike’s dominance is unlikely to return to its former “gorilla” status but affirmed that a return to growth and profitability is possible if the company can reignite product innovation. The next phase will test whether Nike can translate its loyal global fan base into renewed sales momentum while navigating the competitive pressure from fast‑growing rivals.
⚡ Effects Interpreter
🌍World Economylow impact
What this means for you
- ▶Trade flows between continents might bend slightly around news like this.
- ▶A ripple in one major economy can nudge sentiment in several others.
🏙️Local Economymedium impact
What this means for you
- ▶Neighbourhood businesses tend to feel big economic shifts eventually.
- ▶Local firms usually watch national data before setting their own prices.
🏦Rates & Bankslow impact
What this means for you
- ▶Banks generally prefer a wait-and-see approach before touching their rates.
- ▶Borrowing costs might hold steady for now, but they can turn on fresh news.
❤️Healthmedium impact
What this means for you
- ▶Public health messaging can go a long way toward easing collective worry.
- ▶Keeping a normal routine typically helps steady the nerves during unsettling news.
💷Wealthmedium impact
What this means for you
- ▶Retirement plans are seldom derailed by news of this size alone.
- ▶Savers with a clear plan tend to feel less rattled by news like this.
🏠Housingmedium impact
What this means for you
- ▶Landlords and tenants alike rarely feel sudden shifts from this kind of news.
- ▶A cooling or warming market usually takes months to fully show up in prices.
🌍 Effects for your country
The U.S.'s central bank rate currently stands at 3.75%, so a global rates move like this could feed through to local borrowing costs. The U.S.'s economy is growing at 2.3% with inflation at 3.2%, the backdrop this story's effects play out against locally. Housing-market effects like this are usually felt most where mortgage rates track the U.S.'s own central bank rate closely. With the U.S.'s unemployment at 4.4%, personal-finance effects like this land on a labour market that is currently fairly stable. Health-system effects are harder to localise from economic indicators alone — the real impact in the U.S. depends more on local healthcare capacity than the figures above.
The UK's central bank rate currently stands at 3.75%, so a global rates move like this could feed through to local borrowing costs. The UK's economy is growing at 0.8% with inflation at 3.2%, the backdrop this story's effects play out against locally. Housing-market effects like this are usually felt most where mortgage rates track the UK's own central bank rate closely. With the UK's unemployment at 5.6%, personal-finance effects like this land on a labour market that is currently fairly stable. Health-system effects are harder to localise from economic indicators alone — the real impact in the UK depends more on local healthcare capacity than the figures above.
France's central bank rate currently stands at 2%, so a global rates move like this could feed through to local borrowing costs. France's economy is growing at 0.9% with inflation at 1.8%, the backdrop this story's effects play out against locally. Housing-market effects like this are usually felt most where mortgage rates track France's own central bank rate closely. With France's unemployment at 7.9%, personal-finance effects like this land on a labour market that is already under strain. Health-system effects are harder to localise from economic indicators alone — the real impact in France depends more on local healthcare capacity than the figures above.
Romania's central bank rate currently stands at 6.5%, so a global rates move like this could feed through to local borrowing costs. Romania's economy is growing at 0.7% with inflation at 7.8%, the backdrop this story's effects play out against locally. Housing-market effects like this are usually felt most where mortgage rates track Romania's own central bank rate closely. With Romania's unemployment at 6%, personal-finance effects like this land on a labour market that is currently fairly stable. Health-system effects are harder to localise from economic indicators alone — the real impact in Romania depends more on local healthcare capacity than the figures above.
The UAE's central bank rate currently stands at 3.65%, so a global rates move like this could feed through to local borrowing costs. The UAE's economy is growing at 3.1% with inflation at 2.5%, the backdrop this story's effects play out against locally. Housing-market effects like this are usually felt most where mortgage rates track the UAE's own central bank rate closely. Health-system effects are harder to localise from economic indicators alone — the real impact in the UAE depends more on local healthcare capacity than the figures above.