'Just Undo It' : How Nike Lost Its Swoosh And $230 Billion

Nike Sportswear, which includes many of its biggest everyday shoes and apparel, has been particularly weak. Jordan Brand is also struggling.

02 Oct 2026, 09:25 · NDTV

Show
Quick Read
Summary is AI-generated, newsroom-reviewed

Nike's revenue fell 4% to $11.2 billion with a 2% profit decline in the latest quarter
Greater China revenue dropped 22%, reflecting ongoing struggles in the region
Nike's lifestyle business and Jordan Brand face significant pressure and declining sales

What is driving Chinese shoppers toward local shoe brands?

Nike had a winning formula -- make great shoes; sign the biggest athletes; create campaigns people remember; put the swoosh everywhere; and tell the world to "Just Do It".

Today, the slogan carries a very different irony. Nike is cutting jobs, reorganising its global business, warning of another sharp fall in sales and trying to repair problems that have been building for years.

Nike's revenue fell 4 per cent to $11.2 billion in the quarter ended August 31. Profit fell 2 per cent to $712 million. More worrying was the outlook. The company expects fiscal 2027 revenue to decline by a high-single-digit percentage.

Also Read | Layoffs Are Rising In Tech, But These Skills Are Helping People Unlock Better Pay

Investors did not like what they heard. As a consequence, Nike shares fell as much as 8.5 per cent in extended trading after the results, adding to a brutal decline that has already erased a huge chunk of the company's market value. Roughly $230 billion has been wiped out from Nike's market capitalisation from its peak.

But the stock fall is really the symptom. The bigger question is: what went wrong with Nike?

Nike Has A Product Problem?

The biggest issue is not that people have stopped buying sportswear. They haven't.

The problem is that Nike has struggled to create enough products that consumers feel they have to buy.

Nike itself says its performance businesses are showing progress. Running and other sports categories are getting attention again. But the company's lifestyle business remains under pressure.

Nike Sportswear, which includes many of its biggest everyday shoes and apparel, has been particularly weak. Jordan Brand is also struggling. Converse revenue fell 28 per cent in the latest quarter, extending a long run of declines.

The Air Force 1. Dunk. Air Jordan. Cortez -- these were not simply shoes for athletes. They became fashion products.

That formula is now facing tougher competition and changing consumer tastes. Brands such as On Cloud and Hoka have gained ground in running, while competitors in lifestyle footwear have made Nike work harder for consumers' attention.

Nike's Share Over Last Six Months (Credit: INDMoney)

Nike's China Problem

If Nike has one particularly painful geography, it is China. Greater China revenue fell 22 per cent in the latest quarter. On a currency-neutral basis, the decline was 26 per cent.

This is not a one-quarter problem. China has been declining for several quarters as local sportswear brands gain ground and Nike struggles to match changing consumer preferences.

Chinese brands have become stronger competitors. At the same time, Nike's old distribution strategy has not worked as well as it once did.

Nike is now changing that strategy again. From January, it plans to tighten control over online sales in China, pulling back from some third-party digital channels. The idea is to have greater control over how the brand is presented and sold.

But that also carries a short-term cost. When a company changes its distribution model in a market where sales are already falling, the transition itself can create more pressure.

Nike's Affair With Direct Sales

Nike spent years pushing aggressively towards direct-to-consumer sales. But the strategy went too far, according to the company's subsequent course correction.

Nike reduced its dependence on wholesale retailers. That left it less visible in some stores where consumers actually shop. When demand weakened, Nike began rebuilding relationships with those retailers.

North America, where wholesale has been stronger, grew 2 per cent in the latest quarter. Nike Direct, meanwhile, fell 8 per cent, with digital sales down 13 per cent. So, Nike is effectively trying to repair both sides of the equation.

It needs its own stores and digital platforms. But it also needs other retailers.

Nike's Swoosh Lost Some Of Its Spark

There is also a less tangible problem. Nike used to dominate sports culture. Its biggest athletes were marketing machines.

Michael Jordan became bigger than basketball. Nike's association with athletes helped turn shoes into status symbols.

Today, the competitive landscape is more crowded. Brands have become more specialised. Running has become particularly competitive. Consumers have more choices.

Nike still has enormous brand recognition. But recognition is not the same thing as excitement.

"A lack of standout new products and a shift in consumer tastes are factors behind Nike's slower recovery," a senior official from an Indian shoe brand told NDTV.

Nike's Cost-Cutting Measures

The company has announced a new operating transformation called Pace. It includes supply-chain changes, a new organisational structure, fewer geographic divisions and workforce reductions. Nike expects Pace to generate approximately $2.5 billion in cumulative savings through fiscal 2031.

But there is a catch. The restructuring is expected to involve about $1 billion in pre-tax charges, largely related to employee costs. Nike has also said that fewer roles will be needed across the company, with decisions on affected positions beginning in 2027. However, Nike has not specified the final number of job cuts.

Another interesting part of the restructuring is that it's happening far from Nike's headquarters in Oregon. The company plans to establish a new campus in Bengaluru.

Nike says the campus will be a long-term investment in capabilities and talent and will support work across Nike, Jordan Brand and Converse. It is part of the company's attempt to move some decision-making and capabilities closer to the markets and talent pools where it operates.

Signs Of Progress

North America is still growing. Gross margin improved to 42.8 per cent in the latest quarter. Inventory was down 3 per cent year-on-year to $7.8 billion. But those improvements are being overwhelmed by the weak parts of the business.

China is falling sharply.
Sportswear is weak.
Jordan needs a reset.
Converse continues to shrink.

And Nike is warning that revenue will fall by a high-single-digit percentage for the full fiscal year. According to an industry expert, "Nike built one of the world's most powerful consumer brands by repeatedly telling people to Just Do It. Now it has a different task. It has to figure out what to stop doing, what to undo, and what to do differently."

Got a follow‑up question on this article? Go on

How may i help you today

Show full article

Track Latest News Live on NDTV.com and get news updates from India and around the world