But off-camera, the 60-year-old company is stumbling.

Nike has been one of those gross companies that has really worked well.

It's been a surprise to investors who hadn't really seen this coming.

For the fiscal fourth quarter, it looks like a miss pretty much across the board.

This is the first real time that you're seeing Nike really struggle with competition. Nike's market value nosedived over the past few years and is worth more than $100 billion less now than during the last Summer Olympic Games.

Meanwhile, arch-nemesis Adidas, well, it's fared better, let's say, in spite of its own pretty serious public relations headaches.

It's almost like an inverse relationship that we've seen at the two top athleisure brands globally.

It's such a competitive space.

It's on, it's Asics, it's Hoka.

So how did Nike run into trouble? January 1964.

It saw numerous influential births, including Jeff Bezos and Michelle Obama, and, slightly less literally, Nike.

And through innovation, partnerships, and some iconic marketing, it's dominated sportswear ever since.

These three words made up the slogan to beat.

Just do it.

Nike is very good with telling stories.

They happen to have, like, great athletes on their roster.

People felt good in it and they felt like they were closer to their idols, like Michael Jordan.

And for much of Nike's life, that relationship relied on foot traffic in stores.

But over the last decade, the company began to ask itself, do we really need these guys? Nike's CEO, John Donahoe, started back in 2020.

He was brought on to really modernize Nike's online operation.

So that's the app, the e-commerce store, because Donahoe came from eBay.

That's one of the biggest e-commerce companies ever.

But then...

When the pandemic hit, everything went online, right?

So it was all e-commerce, it was all buying off apps, it was all Amazon, everything like that.

I have this app called Sneakers App, and they release...

The limited releases, they were all dropped in this app and in a few top-tier stores.

People really moved toward more casual clothing, and that included sneakers.

We stopped going to work.

We didn't have to wear formal shoes anymore.

High heels slowed down.

These are things we didn't have to wear and we didn't want to wear because they're not as comfortable as casual sneakers.

Products like these, or these, comfortable, cool and wildly popular with shoppers. Donahoe pointed to the results as proof his strategy was working and started cutting those ties with retailers.

But I think that Nike wanted to make digital be 60% of their business and within their DTC, which is digital and stores, they wanted it to be more balanced.

What that meant for a company like Footlocker is that suddenly they need to become less reliant on Nike and they have to go out and find other brands that'll fill that space.

So like Hoka or On or Adidas or anything else that they can have that can take that shelf space and they can present to consumers.

Which was advantageous for smaller rivals trying to muscle in on an incumbent market share.

And it's part of what's driven this surge in investor appetite for the shares of On and Hoka parent company, Dekkers.

As the world reopened, it turned out people still quite liked buying shoes in stores, but Nike just wasn't in as many of them now.

Instead, shoppers discovered those rivals and upstarts with fresh, innovative new styles they've been craving.

We know that there's a cyclical trend in retail away from bricks and mortar and towards technology, but it looks like Nike just pivoted too fast into tech. Nike's lean into lifestyle brands like the Air Force Ones and Dunks paid off during the pandemic, but its lack of fresh offerings also now became apparent.

They started with the Dunk.

At first, everybody wanted to have them.

And then they started to releasing them every day, almost in different colors.

There was nothing new, just hundreds of different colorways.

It was kind of like done and the hype was done.

This is a story of misfires being masked by a pandemic sales boom.

Nike didn't bank on needing so many retail partners once lockdowns ended.

And by sidelining them, the company freed up shelf space for rivals to show off the innovative styles it didn't have.

That's what propelled Nike into such a position that it ended up issuing a profit warning early in 2024, prompting the biggest single day drop in its share price on record. But here's the thing.

The Nike brand is powerful, and the company is still the world's largest sportswear retailer.

That gives it a solid foundation from which to turn things around.

It started by rehiring 30-year veteran Nike executive Tom Petty, who'd retired four years earlier, and with one goal, rebuild relationships with retailers.

And now it needs to give those stores something exciting to put on shelves.

It's going to take some time, which is why Donohoe told investors the next year will be a transition for the business.

But it's towards a comeback for the brand he said has already started.

It just needs to bring forward more newness across its line of products, focusing more aggressively on running and lifestyle, because that is where it's lagged.

And where those pesky rivals On and Hoka in particular have been exciting leg-centric fitness enthusiasts.

Donohoe described running as a competitive battlefield, but one the company is going to fight with innovation and a major marketing push.

It's one of the reasons this year's summer games are key for the company or in Donohoe's corporate speak, a pinnacle moment to communicate our vision of sport to the world.

It's brand exposure to probably the largest viewership in history and of Nike innovation translating to medals.

A bunch of its athletes, LeBron, Kevin Durant, these are the kinds of big names that need to win at the Summer Olympics for this to be a success for them.