Nike (NKE.N) faces investor skepticism as it grapples with dwindling market share in the face of rising competition from newer brands like On and Hoka. The sportswear giant’s decision to cut back on classic shoe supplies, including iconic Air Force 1 sneakers, marks a significant departure from its previous reliance on legacy products. Analysts and investors question whether this strategy shift is a misstep, especially as competitors gain traction in the footwear market. Despite the enduring popularity of Nike’s Air Jordan line, which accounts for a substantial portion of the company’s wholesale revenues, the emergence of alternative brands poses a challenge to Nike’s dominance in the industry.
The shifting landscape of consumer preferences towards chunky dad shoes and terrace styles has prompted Nike to reevaluate its product offerings. While certain retro styles maintain their appeal, Nike’s newer basketball releases, like the Book 1, have failed to resonate with shoppers, dampening the company’s overall performance. With Nike shares experiencing a decline over the past year, investors are closely monitoring the success of upcoming product launches, particularly in the running category, as the company seeks to regain lost ground and fend off competition. As Nike navigates these challenges, the next six months will be pivotal in determining the success of its strategic shift and its ability to regain market momentum.