Proactive Investors - Nike Inc (NYSE:NKE, ETR:NKE) shares dropped by 13% in premarket trading after it warned that its 2025 full-year revenues would be lower than expected amid a downturn in demand.
As newer brands such as Roger Federer’s On and France’s Hoka look to steal market share, Nike said it expects a mid-single-digit percentage drop in the current financial year.
Analysts had forecast a 0.9% rise, according to the LSEG data.
To make matters worse, the sports fashion retailer also missed its fourth-quarter sales guidance after it dropped 1.7% year-on-year to US$12.6 billion.
In recent times, Nike has been attempting to lift its sales by selling straight to consumers, but with pressure from rivals, the move has largely been unsuccessful.
In 2023 the Air Force 1 maker loosened its grip on the market, with its share dropping from 35.37% the year prior to 34.97%, GlobalData revealed.
"Nike is trying to sell a narrative that it's reinventing," said GlobalData analyst Neil Saunders.
“But the numbers they have given ... for 2025, really suggest a company that's in a bit of trouble and the things they're doing just are not going to deliver across next year."
As part of management’s plan to reinvigorate direct-to-consumer sales, Nike is planning on releasing a renewed lineup of products available for under US$100.
“We are taking actions to reposition Nike to be more competitive, and to drive sustainable, profitable long-term growth,” said chief executive Matt Friend.