Why your next pair of running shoes may be more expensive

Business Insider

4 hours ago

Nike is raising prices for US customers to offset an expected $1 billion cost increase from tariffs. A " surgical price increase" is how Nike's CFO Matthew Friend described it.
"These tariffs represent a new and meaningful cost headwind," he said as the company reported its latest earnings on Thursday.
The company's quarterly revenue fell 12% to $11.1 billion — the lowest it's been for around three years — yet still beat analysts' modest expectations.
Friend outlined a four-part strategy, including the price increases, to mitigate the tariff costs, beginning with diversifying its sourcing and allocating production across countries.
Nike said 16% of the footwear it imports to the US comes from China. It expects that share to drop to the high single digits by the end of fiscal year 2026.
It's not just the tariffs weighing on Nike.
Nike is still dealing with the fallout of an unsuccessful shift to direct-to-consumer sales — a move that gave competitors an opportunity to gain shelf space at major retailers.
CEO Elliott Hill returned from retirement last year with a plan for a big turnaround: reduce reliance on its lifestyle business and put sports at the forefront of its strategy.
(Hill is a true insider, having worked his way up from an apparel sales representative intern in 1988.)
There have been positive signs. Nike emerged as a big winner in the Super Bowl advertising game thanks to its star-studded commercial.
The refocus on sports also bolsters the company against a dependency on trends, which are often transient. That said, Nike is still embracing the Snoafer trend — an amalgamation that combines sneaker and loafer.
On the earnings call, Hill re-emphasized the mission objective: "When we focus on sport, we win."
At the time of writing, Nike's stock price is up more than 10% in early trading — and HSBC just upgraded the company's stock rating from "hold" to "buy".
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