Shares of Nike fell another 4%, touching a fresh 12-year low.

The decline came after Dick's Sporting Goods flagged inventory over-allotments in its quarterly earnings, particularly in footwear. The market has interpreted those comments as the retailer effectively saying "we stocked a lot of Nike shoes and no one bought them." The reaction carries extra weight because Dick's is one of Nike's largest wholesale accounts in the United States, so its inventory commentary is read as a signal of broader North American demand for Nike product rather than a single retailer's quarter.

At its core, the share slide reflects a simple reality: consumers are not buying as many Nike sneakers as they used to. According to the analysis, the trend began in China, where local brands such as Anta and Li-Ning started making shoes of comparable quality at better price points. The US trade war then prompted Chinese consumers to "Buy China," and the movement snowballed. From there, China began exporting its domestic brands, which have taken market share in many markets.

At the same time, the United States started hitting the shoemaker with tariffs, which compressed the multiple on business risk. Nike's own supply-chain disclosures show that most of its footwear is manufactured in Vietnam, Indonesia and China, so US import tariffs land directly on its sourcing base.

Underneath the commercial pressures lies what the report describes as a simple erosion of the brand. That has coincided with falling NBA ratings, given the intractable link between the company and the sport — a game increasingly defined by lackadaisical defense, three-point shooting, load management, and a lack of star power. Nike has coasted on Michael Jordan's legacy for decades while chasing the "cool" market, even as rivals focused on running, walking, workwear, and other sports slowly undercut it — a lane where running specialists such as On and Hoka have grown rapidly in recent years. That hollowing out left the company vulnerable, and it now finds itself in what the piece calls a "cool-ness death spiral" alongside its share price.

The report also raises the question of how Dick's will respond to poor sales: fewer Nike shoes on the shelves, and less visibility for the brand. That question matters beyond one retailer because Nike spent years paring back wholesale distribution to prioritize its own direct-to-consumer channels, then reversed course under CEO Elliott Hill, who has made rebuilding retailer relationships a stated priority since taking over in late 2024. Whether other big sporting-goods chains echo Dick's inventory caution in coming quarters will indicate whether the footwear overhang is a one-quarter problem or a broader channel issue.

Source: ForexLive