Nike faces mounting financial and brand pressure following a difficult week marked by Kylian Mbappé’s departure to Swiss brand On, severe stock declines, and marketing controversies, according to reporting by The Athletic and other outlets. The sportswear giant saw its shares drop over 43% this year to around $36, falling significantly from a 2021 high of nearly $180 and straining its position within the Dow Jones Industrial Average.
Kylian Mbappé Departs Nike for On in Multi-Year Equity Deal
Kylian Mbappé ended his nearly two-decade relationship with Nike to sign a deal with On, featuring both cash and equity. The 27-year-old French and Real Madrid striker, who had been receiving free gear from Nike since age eight, turned down a 10-year contract offer worth over €20 million per year from his long-time sponsor. In a 4,000-word interview with The Athletic, Mbappé stated that he wanted to build a legacy with a growing brand entering football, joining former tennis star Roger Federer, whose three per cent stake in On is estimated at around $300 million.
Did you know? Olivier Bernhard, a former Swiss Ironman champion and Nike-sponsored athlete, founded On in 2010 after Nike rejected his initial prototype for a running shoe designed to alleviate chronic Achilles injuries.
Running Shoe Market Share Shifted by Adidas and On
Nike has also lost ground in the competitive running market after Kenyan runner Sabastian Sawe broke the two-hour marathon barrier in April wearing an Adidas Adizero 3 shoe weighing just 97 grams. Although Sawe missed the Berlin Marathon due to injury, the breakthrough eroded years of research behind Nike’s Vaporfly technology, which had dominated elite racing for a decade following its introduction.
Advertising Cancellations and Legal Challenges Compound Losses
The company canceled a scheduled filming session with former Real Madrid striker Karim Benzema after determining the footballer did not align with brand values, following Benzema’s previous conviction for complicity in blackmail in a sex-tape scandal. Nike's subsidiary Converse issued an apology over an advertisement criticized for evoking Ku Klux Klan imagery, while a pending lawsuit alleges the sexual assault of a teenage athlete at the Nike Elite Program in Beaverton, Oregon.
Frequently Asked Questions
Why did Kylian Mbappé leave Nike?
Mbappé left Nike to join On for a deal that includes cash and equity, stating he wanted different goals and a chance to help build a new football brand from the start.
How much have Nike shares fallen?
Nike shares have fallen over 43% this year, trading around $36 compared to a 2021 high of nearly $180.
Who founded On running shoes?
On was founded in 2010 by former Swiss Ironman champion Olivier Bernhard after Nike rejected his early running shoe prototype.
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