TRACK & YIELD

Nike US sales sagg while Adidas remains hot

The Nike-Adidas battle hasn’t been much of a fight in recent quarters.

Nike, the world’s bestselling sneaker brand, has stumbled badly in North America in recent quarters as its designers have missed shifts in fashion and traditional retail chains, where the Beaverton, Ore., company had more to lose.

In fact, North America sales for the Swoosh-meisters actually fell 3 percent in the most recent three-month period, ended Aug. 31.

The stumble marked the first time in more than 10 quarters that Nike saw sales drop in No. 1 sales region.

Meanwhile, Adidas, paying special attention to its design, has posted an average North American sales gain of nearly 26 percent over the past six quarters.

“Adidas has been successful in leveraging the spark from its fashion retro footwear resurgence into other categories, like running and athletic apparel,” Jefferies analyst Randal Konik wrote in a research update.

It remains to be seen if the federal criminal charges lodged against an Adidas executive tied to the college basketball bribery scandal will have any affect on sales.

For Nike, “[k]ey historical ‘go-to’ styles (like Roshe, Free and Jordan) do not appear to be performing strong enough to back-fill revenue short-falls,” Bank of America analyst Robert Ohmes wrote in a report.

Nike, realizing it has been losing its mojo, has recently amped up its direct-to-consumer sales in hopes of sidestepping an ailing brick-andmortar retail scene.

And Nike brand manager Trevor Edwards, on a Tuesday evening conference call to report fiscal first-quarter results, said he was focusing on better reacting to fashion trends.

In August, in a stark example of Adidas’ momentum and Nike’s travails, the German sports brand leapfrogged over Nike’s Air Jordan brand to become the No. 2 selling sneaker in the US.

Nike is still the US sales leader, but Adidas’ exploitation of America’s fondness for athleisure apparel is making retail history.

“We are in a sports-wear-as-fashion cycle right now,” Matt Powell, a sports industry analyst at the NPD Group, wrote in a recent blog. “Brands have been unable or unwilling to create more sportswear to feed this market, instead making more performance prod- ucts that have to be reduced to clear.”

While Nike has stuck to selling performance, it’s not even among the Top 5 “casual athletic” footwear brands, according to NPD.

In the first eight months of 2017, Adidas’ athleisure emphasis has driven the company’s share of the US market to 11.3 percent — up from 6.6 percent during the year-earlier period, according to NPD.

Nike’s share dropped from 39 percent to 37 percent.

Investors have sent Adidas shares up 42 percent in 2017, while Nike shares, down 1.9 percent, to $52.67 on Wednesday, are up just 3.6 percent. Adidas’ ADRs rose 31 cents, to $110.51, on Wednesday.

Adidas’ worldwide sales reached $22.7 billion in 2016. Nike posted revenue of $34.4 billion in the 12 months ended May 31.