Nike Says Its Running Category Is On the Mend. But Is It Enough to Challenge Hoka, On and Asics?
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Nike leadership on Tuesday doubled down on renewed efforts to win in running, a crucial category that has eluded the brand for several years. But some analysts say it will take more to get the struggling athletic brand back on track.
“Nike is a running company,” Nike chief financial officer Matthew Friend said in a Tuesday call with analysts discussing the company’s first quarter results. “It’s incredibly important for Nike to win with runners.”
Friend, who led the company’s first earnings call since it announced that CEO John Donahoe would step down and be replaced by Elliott Hill, told analysts that Nike is diving headfirst into its running “comeback,” which will be fueled by new innovations in product and a focus on new distribution channels in run specialty and sporting goods. These efforts come after several quarters of Nike losing share in running as competitors like Asics, Hoka, On and Brooks gain steam. On top of that, Nike has been criticized for a general lack of innovation and has undergone rolling layoffs and leadership changes at the top.
“The heart and soul of the company was running,” said Burt Flickinger, managing director and founder of retail consultancy Strategic Resource Group. “Nike got away from their strategic foundations, which is compromising the company operationally, financially and in terms of market share.”
According to Friend, Nike’s running presence is already on the upswing. Men’s and women’s running footwear grew in Q1, and the category’s order book for spring 2025 is set for double digit growth compared to the prior year, he said. Friend also touted a new marketing campaign that will display running product throughout the fall and holiday seasons as well as product enhancements like a new maximum cushioning system, new trail silhouettes and new franchises for under $100 a pair.
Analysts, however, cautioned that a fix in Nike’s running business won’t be enough to bring the brand back to its former glory. At least not swiftly.
“It’ll take them more than two fiscal years to course correct,” Flickinger said. “And even then, competitors have such a big lead that Nike is so far down the proverbial track, it can’t even see how far ahead [they] are.”
BTIG analysts Janine Stichter echoed this sentiment in her Wednesday note to investors, in which she touted Nike’s investments in new models for the everyday runner like the Pegasus 41.