The world’s biggest sportswear brands are struggling to maintain their dominance after two decades of rapid sneaker growth, with changing consumer preferences, weaker demand in China and the rise of new competitors weighing on their market values.
Nike, Adidas and Puma have collectively lost around $250 billion in market capitalisation from their peaks, according to calculations cited in the Italian financial press. The downturn comes despite sneakers becoming an increasingly dominant part of the global footwear market.
According to Bank of America estimates, sneakers’ share of total footwear sales has risen from around 20% to 50% over the past two decades. The shift was driven by the growing “casualisation” of fashion, as sports shoes became acceptable in settings that once required more formal clothing.
The trend accelerated during the Covid-19 pandemic as remote working changed consumer habits and reduced the importance of traditional office attire.
At the height of the boom, Nike was valued at around €245 billion, while Adidas reached €61 billion and Puma €16.1 billion. Both Nike and Adidas were also able to push gross margins above 50% as demand for their products remained strong.
Nike takes the biggest hit
The subsequent decline has been particularly severe for Nike, whose market value has fallen by around 82% from its peak.
The company’s market capitalisation has dropped to about $44 billion, pushing Nike out of the S&P 100 for the first time in two decades.
Chief executive Elliott Hill has responded with a major restructuring programme aimed at cutting costs by $2.5 billion. The company is also preparing to reduce its workforce, although the full scale of the job cuts has yet to be determined.
Nike has also suffered a significant deterioration in one of its most important international markets: China.
The US sportswear giant was once seen alongside brands such as Coca-Cola, Volkswagen and Mercedes-Benz as a symbol of Western consumer culture in China. But geopolitical tensions and Beijing’s increasing emphasis on domestic brands have weakened that appeal.
Nike’s revenue in China fell from $8.3 billion in 2021 to $6.6 billion in 2025. The company is now changing its approach to the market, including integrating China into its broader Asia-Pacific reporting and relying more heavily on direct retail sales.
Nike is also seeking to develop products tailored more closely to Chinese consumers. In September, it unveiled a new model inspired by Chinese tennis player Zheng Qinwen, who is ranked among the world’s top players.
Local rivals gain ground
Adidas has faced similar problems in China, with sales in the market falling by around €1 billion from their 2021 peak.
The German company has also adapted its branding to local preferences, including renaming its Terrex outdoor footwear line Shanchuanli in China.
Meanwhile, competition is intensifying in both Western and Asian markets. Brands such as On and Hoka have emerged as serious challengers to Nike and Adidas in Europe and the US, while Chinese companies are increasingly expanding beyond their domestic market.
Chinese sportswear manufacturers also have a growing advantage in terms of pricing and are increasingly using global sports stars to build their brands.
One of the most notable examples came in June, when NBA star Stephen Curry ended his 12-year partnership with Under Armour and signed a 10-year, $400 million sponsorship deal with Beijing-based Li Ning.
From suppliers to competitors
The rise of Chinese sportswear companies is particularly significant because some of the industry’s leading manufacturers have long relied on Asian suppliers for production.
In January, Chinese sportswear group Anta Sports acquired a 29.1% stake in Puma from the Pinault family, making it the German company’s largest shareholder.
Puma is also the weakest performer among the three traditional sportswear giants and, like Nike and Adidas, no longer manufactures its own footwear.
The companies have largely outsourced production to Asia. China accounts for around 52% of Nike’s footwear manufacturing, while Adidas sources about 46% from China and Indonesia. Puma relies on China and Vietnam for around 62% of its production, while newer rival On sources about 88% of its footwear from Vietnam.
The shift highlights a broader transformation in the global sportswear industry: companies that once dominated the sneaker market through their brands and distribution networks are increasingly facing competition from the same part of the world where much of their manufacturing has long been based.
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