The NFL had a bad week, losing $14 billion in court. One of its top partners had it worse. By two.
On Friday, Nike saw $28 billion in shareholder value disappear, as the stock plummeted by nearly 20 percent in one day. The drop happened after Nike announced that it expects sales to decline in the coming fiscal year.
The company’s stock has been steadily dropping since November 2021, from more than $177 per share to $75.65 at closing on Friday.
As noted by CNBC.com it was the worst day for Nike shares since it went public in December 1980.
Nike also has laid off two percent of its workforce, trimming $2 billion from the payroll.
Since 2012, Nike has served as the NFL’s exclusive apparel provider. It’s the only corporate logo that appears on the player uniform, and the company has had a hand in steering pro football toward the umpteen uniform combinations that some college programs have.
Currently, Nike is focused on bigger things than how many different helmets, jerseys, and pants can be forced onto a given football franchise. CEO John Donahoe could be out, among other significant changes at the top of the company, which has harmed its bottom line by focusing too much on established brands, not coming up with new styles, and pissing off retail partners by selling directly to consumers — which in turn opened shelf space for competitors.
Nike’s deal with the NFL runs through 2028. By then, the NFL might avoid its $14 billion loss via future court rulings. Whether Nike turns it around remains to be seen.