Nike will be removed from the S&P 100 index later this month as part of the index’s quarterly rebalance, ending a run of nearly 18 years among the top 100 companies tracked by the benchmark. The company will be replaced by Dell Technologies (DELL), Palo Alto Networks (PANW), Arista Networks (ANET) and SanDisk (SNDK), which are among four firms joining the index in place of Nike and three others.
The change comes after years of underperformance for the sportswear giant. Nike’s stock has fallen 78 percent since a 2021 peak, and the company traded this summer at levels not seen in more than a decade.
Forbes has pointed to several factors behind the decline, including Nike’s heavy reliance on older product franchises, a direct-to-consumer strategy that has not delivered expected results, weakened relationships with wholesale retailers, growing competition from brands such as Hoka and On, and a soft market in China.
The shakeup in the S&P 100 also reflects a broader shift in market composition, with technology and AI infrastructure companies increasingly displacing traditional consumer brands among the index’s largest constituents.
Roots of the decline
Nike’s stock troubles trace back a decade, to when former NFL quarterback Colin Kaepernick first knelt during the national anthem in protest. Nike went on to feature Kaepernick in its 2018 “Let’s Do It” campaign, a move that coincided with a roughly 15-point drop in the company’s favorability ratings among consumers, according to prior reporting. President Trump also commented publicly on the backlash at the time.
Nike shares saw a brief rebound in 2021 before resuming their decline. Breitbart News reported last month that the drop from the 2021 peak has wiped out roughly $200 billion in market value.
The removal from the S&P 100 marks another marker in the company’s prolonged slide, as it continues to grapple with sales declines and shifting consumer preferences in a more competitive sportswear market.
