Over the past few years, the sports-gear market has been experiencing a decline in sales. With the decrease of popularity, many major athletic brands have been forced to make significant cuts.
The first brand to announce their declining sales was Nike, the world’s largest athletic-gear company. They announced in June that they would be cutting 1,400 jobs globally, with efforts to restructure their organization.
They said that in order to streamline the company’s speed, organization, and branding, cutting around 2% of their workforce was necessary. The president of the Nike Brand, Trevor Edwards, assured Fortune that this was the best move for the company.
He said, “This new structure aligns all of our teams toward our ultimate goal- to deliver innovation, at speed, through more direct connections.”
Following Nike’s initiative, Under Armour announced on Tuesday that they are making significant cuts as well. The company will also be cutting around 2% of their global workforce, forcing 300 individuals out of their jobs.
Under Armour is best known for their Stephen Curry basketball shoes, Bandit running shoes, and sweat-wicking under garments. According to Fortune, the company is expecting a full-year revenue growth of only 9%, compared to the previous year’s 11-12%.
This force in cuts is a result of decreased sales that has caused their stocks to plummet. Almost a year ago, Under Armour shares were around $43. As of Tuesday, they are at $18.15.
The decrease in sales in both Nike and Under Armour, as well as other popular stores including Lululemon Athletica, is largely due to the slowing retail market. However, some athletic-gear companies continue to increase in popularity, including Adidas and Puma. It is reported that these brands are doing well because of their retro activewear, which is rising in fashion popularity.
What do you think about this? Do you love Nike and Under Armour? What do you think they can do to be more competitive in the market? Let us know on Facebook! In other sports news, a professional soccer player and his wife just announced a pregnancy, with a surprising twist.