Nike, a giant in the sports industry, once highly favored by young people in China, has recently reported a 13% year-on-year decline in revenue for the past year, with a profit decrease of approximately $7 billion. The era of Nike shoes being hyped at high prices and hard to obtain seems to have passed.
On June 27, Nike announced its financial report for the 2025 fiscal year (June 2024-May 2025), revealing a total revenue of $46.3 billion, a 10% decrease compared to the previous year. The overall net profit also dropped by 44% to $3.2 billion. Nike’s revenue in China for the year was $6.586 billion, marking a 13% decrease from the previous year and the poorest performing market globally.
The underperformance of Nike in China can be attributed to the rising competition from domestic brands like Anta, Li Ning, Xtep, and 361°, especially in Nike’s traditional strongholds of running and basketball. Additionally, Chinese brands are offering comparable quality to Nike at relatively cheaper prices, making them more readily accepted by consumers.
Moreover, after the Xinjiang cotton incident came to light, Nike and Swedish clothing giant H&M expressed concerns over forced labor in cotton production in Xinjiang, leading to strong backlash in China due to their previous stance against Xinjiang cotton usage.
In recent years, Nike has relocated its factories from China to Vietnam to reduce costs. However, many netizens have criticized the lack of skill and quality control at Vietnamese factories.
Previously, many young people in China treated Nike shoes as financial assets for speculation. In September 2021, a Nike shoe named “Thunder Shock” with an original price of 1,599 yuan skyrocketed to over 30,000 yuan after its release. Referred to as the “Shoe King of 2021” by sneaker enthusiasts, its price multiplied several times, yet remained elusive.
During the official release of the Nike “Thunder Shock,” over 20,000 pairs were available through a lottery system that attracted millions of participants. Those who won the lottery were dubbed as the “Chosen Ones” by the sneaker community, while those who didn’t were likened to the “leeks” in the market.
Amid a general decline in purchasing power, Nike introduced a plethora of heavily discounted products during the 618 shopping festival, along with various coupons for further reductions. Despite the significant discounts, this strategy managed to retain many consumers, leading Nike to top various platforms. At the end of June, during a financial report meeting, Nike’s global CEO, John Donahoe, stated that Nike is currently clearing out the promotional market in China to make room for upcoming innovative products.