Michael Jordan might be facing his biggest off-court challenge yet. Nike’s recent financial troubles could threaten not only the former NBA star’s massive income stream but also the partnership that helped catapult the sportswear giant to fame nearly 40 years ago.
The partnership began in 1984 when Jordan signed his first endorsement deal with Nike. The following year, they launched the original Air Jordan in April 1985, marking the start of one of the most lucrative collaborations in sports history-earning Jordan a staggering $260 million in 2024 alone.
But this golden era might soon face turbulence. Nike is currently grappling with a financial slump, with declining revenues that could potentially impact the six-time NBA champion’s substantial royalty earnings.
What’s going wrong for Nike?
A recent Reuters report sheds light on the brand’s struggles, including an 11% decline in in-store traffic and a 35% drop in app downloads between October and December 2024.
The situation looks even grimmer when viewed through the lens of financial projections. According to Reuters, Nike’s third-quarter profits are expected to fall by 11.5% year over year-from $12.44 billion in 2023 to $11.01 billion in 2024-a staggering $1.43 billion decrease.
And it’s not just about the numbers. Nike’s recent marketing campaigns have missed the mark with their target audience, drawing criticism on social media for their pricing and ad aesthetics. But what could this mean for the Chicago Bulls’ former star?
Jordan Brand: Still flying high?
Despite Nike’s struggles, Jordan Brand remains a robust player in the market. Its most recent reports project $7 billion in sales for 2024, accounting for 14% of Nike’s $51.4 billion revenue during that period.
Even so, some products, such as the limited-edition Air Jordan 1 High ’85 “Banned,” faced criticism from sneakerheads. Nevertheless, the brand achieved a 6% growth in annual sales, reinforcing the stability of Jordan’s royalties-and his enduring cultural legacy.
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