In December, Nike announced that it would lower its sales outlook for fiscal 2024 to just 1% growth, down from mid-single digits. Along with this news, the company also announced plans to cut $2 billion in costs over the next three years. This forecast, which would represent the lowest year-on-year growth since 2010, excluding the pandemic slump of 2020, remains unchanged as confirmed by Nike. Despite this news, analysts have upgraded Nike shares from ‘neutral’ to ‘buy’, leading to a 2.5% increase in share price.
In Paris last week, Nike unveiled its plans for the future with a focus on reinventing the Nike Air sneaker. The brand showcased new iterations of the sneaker to be worn by athletes at the Olympics, as well as a new Pegasus Premium model for consumers set to launch in 2025. Nike also introduced an AI-generated interpretation of Air technology co-created with athletes. This innovation was framed within the historical significance of the Air sneaker since its launch in 1978 and its recent collaborations with brands like Sacai and Comme des Garçons.
Moving forward, Nike is gearing up for a big marketing push starting on July 26th. The International Olympic Committee has relaxed its rules through a Rule 40 pilot program, allowing non-official Olympic sponsors like Nike to have a greater presence during the games. This includes the ability to interact on social media in real-time and use Olympic IP and athlete imagery, which was previously prohibited. The aim is to expand the Olympic brand’s reach to younger consumers, drive more traffic, and provide more opportunities for athlete endorsements.
