Nike has a leg up on Adidas

In a World Cup brimming with upsets, Nike looks on track to defeat soccer juggernaut and archrival Adidas in the closely watched jersey sponsorship battle.

The Nike swoosh decorates the outfits of Brazil, France and England, the sides in the quarterfinals most favored by betting websites to win the World Cup, plus Croatia.

Top German brand Adidas has Belgium, Russia and Sweden in the quarterfinals, with the group of eight rounded out by Uruguay, sponsored by Puma.

The combined accomplishments of Nike-sponsored teams in Russia mark a major success for the US sportswear company as it pushes to increase global soccer-related sales that reached more than $2 billion in fiscal 2018.

Nike kitted out more teams than Adidas for the first time in Brazil in 2014. Adidas fought back this year, sponsoring 12 of the 32 participating teams.

“While Adidas dominates the European leagues and the US professional league, certainly any market share that Nike can pick up in a non-traditional US sport can only bode well for the stock price and brand,” said Jake Dollarhide, chief executive officer of Longbow Asset Management in Tulsa, Oklahoma.

Sports brands typically sell the bulk of their fan merchandise ahead of the World Cup, but a team’s success on the field can generate extra demand for gear emblazoned with its emblems and colors, especially if its progress is unexpected.

Nike kitted out more teams than Adidas for the first time in Brazil in 2014. Adidas fought back this year, sponsoring 12 of the 32 teams, including two big pre-tournament favorites, Germany and Spain, along with host Russia.

Nike supplied shirts for 10 countries this year.

The tournament took a disastrous turn for Adidas last Wednesday, with the elimination of 2014 champion Germany. Shares of Adidas, Germany’s team sponsor, fell 2.7 percent in the following session.

In 2014, Germany accounted for a third of Adidas’ roughly 9 million team-jersey sales, with 10 percent of those sales resulting from Germany’s tournament victory.

Over the weekend, Adidassponsored Argentina and Spain were eliminated. Likewise, Mexico lost to Nikesponsored Brazil on Monday.

Adidas, though, has downplayed the World Cup’s potential effect on sales, pointing to Russia’s tepid economy.

But the global tournament remains a major marketing opportunity for Adidas, which is one of seven FIFA partners and the supplier of the World Cup match ball since 1970.