Nike Quietly Admit '50 Billion by 2020' Isn't Realistic
Nike’s 2017 Investors Day has come and gone, and the brand’s lofty goals of bringing in 50 billion USD in revenue have gone with it.
The conference, focused on wooing analysts and quelling shareholders’ concerns, was of particular interest in 2017. Grave predictions of the company’s growth and share downgrades have been making headlines for months. Bezinga's ‘Just Not Doing It’ reports that Goldmans Sachs have again downgraded Nike shares and cites adidas’ rising star as the reason.
Naturally, Swoosh CEO Mark Parker doesn’t agree and seems to have spoken Nike's growth into existence. During Investors Day, Nike share prices rose by 2 per cent as Parker spoke on ‘Direct to Consumer’ initiatives and a projected 50 per cent growth due to upcoming innovations. On the face of it, that forecast would see Nike reach their 50 billion revenue goal. The catch is they won’t reach it by 2020.
In an interview with CSNBC, Mark Parker told Sara Eisen that Nike ‘plan to achieve 50 billion within the next five years,’ not three. It’s a quiet moving of the goal posts that confirms the brand are in trouble. Parker later brushes off issues like Jordan Brand’s decline (‘We’re going through a market correction’) and the LeBron’s ripped NBA jersey (‘We’ve isolated the issue’), but isn’t willing to speak directly on adidas’ growth. ‘Competition is a good thing,’ he parries. Although, weighing the revelations from this year’s Investors Day, it seems Nike are losing their competitive edge.