Adidas is currently outperforming Nike in the sportswear recovery race, driven by its success in elite athletics and the halo effect of the World Cup. The company's Adizero Pro Evo 3 shoes, priced at $500, contributed to three runners breaking sub-2-hour marathon records, providing Adidas with a competitive edge in performance footwear. This success has helped Adidas regain market momentum, especially in the fast-growing running segment, at a time when both brands face market and financial pressures.
Despite Adidas's advantage, both companies are experiencing challenges, with their shares falling by 29% and 22% respectively over the past year. This is attributed to squeezed profit margins from discounting and increasing competition from Chinese rivals like Anta and Li Ning, particularly in the crucial domestic market. Both Adidas and Nike had previously prioritized streetwear, leaving them vulnerable to the growing demand for performance-oriented gear.
Analysts are bullish on Adidas's prospects, with HSBC analyst Akshay Gupta noting a 33% increase in web traffic year-over-year for Adidas, compared to a 2% decline for Nike. U.S. foot traffic in Adidas stores surged by 16% year-over-year during the first week of the World Cup, while it declined for Nike. Deutsche Bank analyst Adam Cochrane expects Adidas to deliver a strong second quarter, with sales growth at a constant foreign exchange rate projected at 16%, boosted by the World Cup. He also forecasts fiscal year earnings per share (EPS) of 9.8 euros.
The World Cup has significantly contributed to Adidas's strong global momentum, with analysts expecting the brand to potentially raise its 2026 guidance. Adidas, as the official FIFA World Cup sponsor, enjoys unmatched visibility and is benefiting from strong demand for football shirts. In contrast, Nike's sell-through rates for World Cup merchandise have significantly underperformed Adidas.
