Even the 2024 Paris Olympics can’t save Nike

Nike’s stock is getting hammered Friday, dropping 20% after the company gave underwhelming guidance for its new fiscal year and said fourth-quarter sales fell more than expected. During the earnings call, CFO Matthew Friend dropped a bomb: Nike’s sales during its current quarter – the one that will include the next Olympic Games in Paris – are expected to drop 10%.

That would be the first time Nike’s sales fell during an Olympic quarter since at least the turn of the century. An analysis of financial data going back to the 2000 summer games in Sydney shows that Nike’s sales during Olympic quarters have risen an average of 9.9%, slightly higher than an average of 7.9% during non-Olympic quarters. So a drop of 10% is especially abnormal. 

Olympic season is usually a time when consumers around the world are inundated with Swooshes slapped across athletes’ uniforms, warmups, and shoes. The Team USA online store and Nike.com are already chock full of Nike Olympics gear. But after their new track and field uniforms were called too revealing even for professionals, it seems consumers may be hesitant to add to their carts. Following the recent new Major League Baseball uniforms debacle, it’s not a good look for the brand. 

“We're very excited about the Olympics coming,” Nike CEO John Donahoe said early in the call. Later, he added: “We can't wait to bring all this Olympics product to life across the games and in more than 8,000 doors worldwide. And throughout, our brand storytelling will be bold and clear, with sport and athletes at the very center of it all, from brand voice to retail activations.”

But those potential “retail activations” didn’t matter nearly as much as the revenue forecast to investors, who slashed some $28 billion off Nike’s market cap as of midday Friday.