For Nike, is the worst over?

This is the last Week Ahead newsletter of 2022. We will resume publication in January.

When France take on Argentina in the World Cup final on Sunday, it will also mark the final clash between the two sportswear giants: Nike, which sponsors the France national team, and Adidas, which dresses their opponent. As with any top-flight football game, there’s even drama behind the clash of logos – Argentine star Lionel Messi, probably playing at the last World Cup of his career, was a longtime Nike ambassador before signing a lifetime contract with Adidas in 2017. His undisputed successor as the sport’s biggest star, Frenchman Kylian MbappĂ©, wears Nike.

Off the pitch lately, the Nike vs. Adidas rivalry is more like Spain’s blowout 7-0 win over Costa Rica earlier in the tournament. Even before its problems with Yeezy, Adidas was struggling to connect with consumers (a BoF Insights survey of Gen-Z shoppers found that 22% named Nike as one of their top three favorite brands, double the part of Adidas).

Nike had its own ugly moment with a celebrity ambassador this fall, when NBA star Kyrie Irving shared a link to a movie promoting anti-Semitic conspiracy theories. But the athlete’s now-cancelled sneaker line was nowhere near as important to the mainline brand as Yeezy was to Adidas.

Still, Nike has faced more conventional issues: it ordered too much stock as 2022 approached, and it saw sales plummet in China due to the country’s strict Covid policies. Analysts who follow the company say the worst may be over. Nike stores were packed during Black Friday as it put its excess stock on a steep decline. And China is emerging from its Zero Covid isolation.

There’s still a chance that both issues will weigh on Nike’s sales and margins in the coming year – the scale of the company’s excess inventory surprised the market in September and could again. The way forward in China is also murky, and local sportswear brands have been gaining ground during the pandemic. Adidas has a new CEO, Puma’s Bjorn Gulden, to chart the company’s post-Yeezy path.

But it’s also not hard to imagine a return to form in 2023. Nike’s strong brand automatically gives it a head start when testing new markets or sales channels, whether a web3 platform or the first store of the Jordan brand.

What else to watch this week


France take on Argentina in the World Cup final


Holiday sales results and final projections are expected to start rolling in from retailers and analytics firms this week.


The Swiss watch industry declares its exports for November

Nike’s second quarter results

Eurozone consumer confidence reading


Christmas Eve

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