Nike loses its S&P 100 seat after an $200 billion market-cap collapse
Nike exits the S&P 100 after 18 years and a $200B market-cap wipeout
Nike will drop out of the S&P 100 on September 21, ending nearly 18 years in the benchmark. The sportswear giant has shed over $200 billion in market value since its November 2021 peak, a roughly 78% decline, with shares now near $38. Greater China sales fell 17% last quarter, direct-to-consumer revenue dropped 6%, and the company warned of further declines into fiscal 2027. Dell, Palo Alto Networks, Arista Networks, and Sandisk take the vacated spots.
Nike used to race to the top of the S&P 500—now it's running in the opposite direction.
- nemothekid
Nike's destruction over the past 5 years was really surprised and until I read up about the whole "direct to consumer" fiasco it really helped me understand another trend I was a bit confused about.
About 2-3 years, it felt like, out of nowhere everyone was wearing Hoka and On brand sneakers. In my entire life it felt like the Nike/Adidas duopoly was unbreakable, and then it felt suddenly that Hoka was everywhere.
While Hoka probably executed extremely well, I imagine it was an incredibly lucky position Hoka found themselves in when all those retailers had to replace Nike with something. Maybe even allbirds would be in a better position today had they launched 3-4 years later.
Edit: I just looked it up and it seems both Hoka and On were founded before Allbirds. Seems allbirds imploded (~2021), just as Nike was ceding all their retail space (also around 2021). Had they had another year, maybe they wouldn't have had to pivot into an AI datacenter company.
- alexpotato
There is a great article [0] that has some interesting points about this:
- Nike used to be very "male coded" e.g. "Be like Mike"
- So much so that they were one of the only companies where men bought more clothes than women
- The powers that be wanted to go after the "Adjacent Whale" (explained in the article) that was the female consumer
- They ended up alienating their core customer base while competing poorly with other brands
0 - https://www.houseofstrauss.com/p/nikes-end-of-men?r=11111
- maxglute
Too much sneaker head gambling, Nikes started to feel like wearing pokemon.
- freetime2
I had a good 15+ year run where I only ever wore Nikes. Then I wore my first wide toe-box shoes and haven’t bought Nike since.
Looking back, Nike was never very good about offering different width options on most of their shoes. And I still don’t think they offer wide toe box shoes.
- branko_d
Last month, I bought two pairs of sneakers: one was a full leather design made in Spain, the other was a leather/cloth combination (Italian design, I'm not sure where they are made). Both are comfortable, seem to be of very good quality and look premium. The price of these two pairs together was less then one Nike pair made of synthetic materials.
This was in Novi Sad, Serbia. I don't know what's going on around the world, but if this anecdote is of any indication, Nike is simply too expensive for the (lack of) quality they have.
- zhivota
I used to get all my running shoes from Nike, the Pegasus line which was always their basic running shoe that was very good overall. These days, I can get what is basically the same shoe from Decathlon for 1/5th the price of last year's Pegasus.
Running shoe tech is not some kind of secret thing. Any shoe manufacturer can buy a pair of any other shoes and cut it open and copy it. The only shoes that have anything special in them are the ones with the carbon fiber spring plate, and those are highly specialized and only last for a few races anyway, not for me as a casual runner in his 40s.
- rf15
Beyond the stock market gambling aspect, what actually happened here?
> revenue down 2%
That means almost nothing, right? Some fluctuation must be expected. The Stock also looks like it really benefited from a Corona boost that is now cooling off.
Can someone with more insight explain why everyone is screaming?
- duckmysick
I wanted to check the primary source so I went to (what looks like) the official S&P website and their S&P 100 section at https://www.spglobal.com/spdji/en/indices/equity/sp-100/
I can't find any press release about it. And the Constituents section lists only 10 of them, so I can't check who is there. I even checked the PDFs with methodology but couldn't find the list there.
I even tried to limit the search on Google to spglobal.com domain and I can see this in the result preview: "Constituents. Top 10 Constituents by Index Weight. Full Constituents List. Constituent. Symbol. Sector*. Sector Breakdown." But when I click it, Full Constituents List is nowhere on the page.
What's going on? Am I missing something obvious?
- sh-run
As a trail runner it’s been weird to watch. Nike ACG has been putting out some seriously good, cutting edge equipment. Ultrafly is a great shoe, as is the Pegasus trail for road-to-trail they’ve also got some neat cooling tech that I don’t have personal experience with.
Project Oregon left a bad taste in a lot of people’s mouth. It feels like right when they recovered their image with runners they are losing mass appeal.
- aczerepinski
A huge percentage of Nike’s sales come from vintage shoes like dunks, air force ones, Jordan 1s, etc. By modern standards, they aren’t good shoes. They aren’t suitable for the sport they were originally designed for, and they aren’t comfortable compared to modern lifestyle shoes.
I can’t believe Nike is ok with that being how loads of people experience the brand. Why not spend an extra $2 upgrading the cushioning to React or Zoom so that they feel good on foot?
Nike does of course also make great modern shoes, but you have to know what’s what.