Nike to Cut China Reliance Raises Forecast Despite Tariffs

Post by :

Nike has announced big changes to how it makes and sells its shoes. Right now, about 16% of Nike shoes sold in the US come from China. But the company wants to cut that number down to under 10% by May 2026. Why? Because the US government has added high taxes on products from China. These new taxes could cost Nike about $1 billion more.

To avoid these extra costs, Nike will move some of its shoe production to other countries. The company also said it might cut some corporate spending and raise prices on certain products in the US. However, experts believe other sports brands will also raise prices, so Nike might not lose many customers.

Even though sales dropped 12% in the last quarter, that was better than what experts expected. Nike also said it expects sales in the next quarter to go down, but not as much as people thought.

Nike’s new CEO, Elliott Hill, is focusing more on real sports and athletes, instead of just fashion shoes. Nike recently put more money into developing better running shoes, like the Pegasus and Vomero, and reduced focus on casual shoes like the Air Force 1.

In fact, Nike recently hosted a big event where athlete Faith Kipyegon tried to run a mile in under four minutes. She didn’t make it, but still broke an unofficial record.

Nike says things in China are still tough because of the economy and more competition. Right now, the amount of extra products sitting in storage is about the same as last year — $7.5 billion worth.