Nike Drops From S&P 100 Index After 18 Years Amid Declining Sales
Nike has dropped from the S&P 100 index after 18 years amid falling sales, increased production costs, and high-profile athlete departures like Kylian Mbappe.
Nike has fallen from the prestigious S&P 100 index for the first time in 18 years following negative forecasts. Staple Hedge Fund, valued at approximately $12 billion and a sponsor of several professional sports teams, announced a downgrade of Nike's stock target from $45 to $40, while the stock trades near its 52-week low of $35.50.
This current decline stems from a variety of factors, including counterfeiting, knockoffs, declining consumer spending, and more. Alongside these external pressures, it is hard to ignore the company's internal management shifts and the sharp departures of major names.
Strong on the Map, Supposedly
Currently, Nike appears on the uniforms of the MLB, NBA, and NFL, as well as over 20 leading European football clubs. The sponsorship model operates differently between Europe and the United States.
In the US, Nike is signed to a long-term agreement with the leagues themselves and serves as the exclusive outfitter for all teams. The largest agreement was signed with the NFL in 2024, valued at $200 million per season, including apparel sponsorship and on-field branding, valid through 2038.
In Europe, Nike conducts independent deals with individual clubs and collects commissions based on product sales according to rates set directly with each team. Prominent examples include Barcelona, Liverpool, Chelsea, and Paris Saint-Germain. Nike is currently in advanced negotiations to replace Adidas as the sponsor of the Champions League, a partnership generating about $55 million annually.
The presence of Nike and other outfitters on fan merchandise is an effective way to expand brand presence and solidify global market power. This presence is amplified by ambassadors across disciplines, led by Michael Jordan, whose Air Jordan brand remains one of the most recognizable in sports—recording $7.3 billion in revenue in 2025 alone. Active athletes include LeBron James, Cristiano Ronaldo, Erling Haaland, Carlos Alcaraz, Vinicius, and others.
The Mbappe Departure and Market Volatility
Days ago, Kylian Mbappe surprisingly announced his departure from Nike after a 20-year partnership that was halted at the company's own request. "Of course, I had 20 amazing years with Nike, I can only thank them," the Frenchman stated immediately after signing with Swiss brand On.
This marks the end of a significant partnership with one of the world's most prominent players. Reports on the matter suggest this is part of the ongoing consolidation under Elliott Hill, Nike's relatively new CEO, who has faced criticism regarding his direct contribution to the decline in the company's stock value.
Additionally, tariffs imposed by US President Donald Trump on China forced the company to absorb an extra $1 billion in production costs. In response, Nike announced plans to reduce its reliance on manufacturing plants in China.
A Wavy Market
In 2025, Stephen Curry left Under Armour after a 13-year partnership. Surprisingly, the stock surged in 2026 despite the player taking the exclusive rights to his footwear brand with him.
Even after losing the face of a brand not traditionally specialized in basketball, the impact was considered minimal, if not beneficial. In contrast, Nike has seen declines in Chinese sales (10%), digital sales (21%), and wholesale sales (13%) over the past year, according to Yahoo.
The parting with Mbappe does not necessarily mean an immediate blow to brand revenue, but it may initiate a shift in Nike's approach toward the athletes in its portfolio.
In a conversation with "Hayom," Dr. Tal Aloni Rosen, a strategic consultant for companies and businesses, academic lecturer, and researcher in marketing, sports marketing, and consumer behavior, noted she views Mbappe's departure as the root of Nike's problem.
"For years, Nike was much more than a sports apparel and footwear company. It knew how to turn sport into a cultural movement and a value system. 'Just Do It' was not just a slogan, but a rallying cry. In recent years, Nike has struggled to maintain this power and translate its heritage into something relevant to the current generation.
Generation Z no longer buys a product just because the Nike name is on it. They want to know who stands behind the brand, what it represents, and why it is relevant to them. Choosing a brand is largely a statement of the consumer's values and identity.
The moment a brand stops generating conversation and starts chasing trends, it loses part of its power. This is where Mbappe's departure becomes significant, because when a brand loses its ability to be the natural choice for stars and consumers, it is about much more than sales."
Adidas Won the World Cup
The last World Cup was supposed to boost Nike's stock, but it actually lost the visibility contest to Adidas, which outfitted 14 national teams compared to Nike's 12.
Overall, Adidas has shown strengthening in footwear over the past year, with its market share growing from 16% to 19.2% according to M Science data. Furthermore, in the final featuring Argentina and Spain, the primary winner was Adidas, which outfitted both teams.
Before the tournament, estimates hovered around $300 million in profits for Nike resulting from first-quarter 2027 exposure, so we must wait to see the fruits of that as the market already reacts negatively to performance.
Room for Optimism?
With the NBA season underway, as LeBron hopes to lead the Philadelphia 76ers to a championship in what might be his final season, alongside Victor Wembanyama—another Nike representative who already brought the San Antonio Spurs to the finals—the company has plenty of reasons to be satisfied.
It houses the two most important players in the league—the future and the past—simultaneously. Nike's headquarters will need to execute significant moves to ensure other stars do not leave to prevent a sense of collapse.
Dr. Aloni Rosen shared that she remains optimistic about the company's future: "I don't think Nike's story is over. Nike still has tremendous assets: a global brand, history, a deep connection to the sports world, and a lineup of the world's most prominent athletes. But the path forward goes back to the basic question: What does Nike want to represent?
The future lies precisely where the younger generation already is. They seek meaning, not just a logo. For years, Nike succeeded in making people feel they were not just buying a product, but part of something bigger. Today, it must return to infusing real meaning into the brand, because it can no longer rely solely on the power of the logo as it did in the past. Ultimately, this is a question of identity. Nike must re-decide what kind of brand it wants to be and what it wants to tell the world."
