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Nike's Jordan Brand Gains Secondary Market Share Ahead of Planned Supply Cuts

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NKE$37.47 0.89%

NIKE, Inc. (NKE) captured 72.3% of secondary-market sneaker resale volume in September, representing a 0.63 percentage point increase from August. The improvement was primarily driven by the Jordan brand, exceeding the 70.8% average recorded between June and August, though remaining below the 77.0% peak seen in October 2023. Shares of Nike traded up 0.95% at $37.49 following the data.

The secondary-market progress comes as Nike works to stabilize core franchises. During the first quarter, the Jordan brand generated 13% of global business while experiencing a mid-teens sales decline. Management acknowledged oversupplying retro Jordan items and announced plans to curtail release frequency and volume to restore product desirability. Meanwhile, Nike expanded first-quarter gross margins by 60 basis points to 42.8%, boosted by high-single-digit growth in its performance line.

Investors are monitoring whether secondary market gains translate into primary revenue growth. While resale trading indicates lingering brand popularity, management anticipates a high-single-digit sales contraction for fiscal 2027. Market participants will watch if tighter Jordan distribution succeeds in improving pricing power and protecting long-term profitability without further eroding near-term top-line results.

Key points

  • Nike captured 72.3% of sneaker resale volume in September, up 63 basis points from August, driven by the Jordan brand.
  • Jordan sales dropped in the mid-teens during the first quarter, representing 13% of total global business.
  • Management is scaling back retro Jordan launch volumes and frequency to reduce discounting and rebuild exclusivity.
  • Nike's first-quarter gross margin rose 60 basis points to 42.8%, but management projects a high-single-digit revenue decline for fiscal 2027.

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Questions and answers

Why is Nike cutting supply of Jordan sneakers?

Nike acknowledged oversupplying iconic retro Jordan products. Management plans to reduce launch volume and frequency to rebuild brand exclusivity, decrease discounting, and support long-term profitability.

What was Nike's secondary market share in September?

Nike captured 72.3% of sneaker resale volume in September, up 63 basis points from August. The share exceeded the summer average of 70.8% but remained below the October 2023 peak of 77.0%.

What is Nike's revenue outlook for fiscal 2027?

Nike management projects a high-single-digit revenue decline for fiscal 2027 as weakness in key segments continues to impact overall business recovery.