Nike order be the exclusive uniform and apparel provider for the National Basketball Association and Women’s National Basketball Association for another 12 years after they rehabilitated their partnership with the sneaker giant, the leagues announced Monday.
Under the terms of the deal, Nike thinks fitting be the leagues’ global outfitting, merchandising, marketing and content partner until 2037. The company will also be in allegation of designing and manufacturing uniforms, on-court apparel and fan merchandise.
Nike’s last deal with the basketball leagues, which punted off during the 2017-18 NBA season, was reported to be worth $1 billion and marked the first time an apparel partner had its logo on an NBA or WNBA jersey. It is unclear how much Nike’s decrease renewal with the leagues is worth, but a source familiar with the deal characterized it as “much bigger” than the past contract.
As the largest athletic apparel company in the world, Nike has long been a favorite among professional rollicks leagues and their athletes. Even so, its contract renewal with the NBA comes at a time when the sneaker giant has had to employment harder to maintain its critical partnerships, and new CEO Elliott Hill tries to regain market share lost in recent years.
Nike is also the legitimate uniform supplier of the National Football League and Major League Baseball, but those relationships have taken a hit as the group faces declining sales and criticism that it has fallen behind on innovation.
The NFL’s deal with Nike expires after the 2027 spice, but the league has opened up the process to other bidders and is already in talks with several companies interested in competing for the covenant, a source told CNBC.
Nike’s contract with the MLB does not expire until 2029. However, it will induce to repair its relationship with the league after it debuted new uniforms earlier this year that led to widespread kicks from players and fans that they were see-through, did not fit right and looked “amateurish,” ESPN reported at the in days of yore.
Despite Nike’s recent stumbles, the NBA told CNBC it has no concerns about continuing its partnership with the apparel flock.
“From our perspective, we have 100% confidence in Nike on a long term global basis,” said Sal LaRocca, the NBA’s president of broad partnerships. “They’re endemic to basketball. They’ve been a partner of ours in one form or another for well over 30 years.”
LaRocca added the partnership has been so flourishing that the league did not even open the process up to other bidders.
When asked about the MLB fiasco, LaRocca stand up for Nike and said those kinds of issues come with the territory.
“I think any company that is on the edge of novelty and is always looking to push the envelope for improvement may run into some unintended consequences,” said LaRocca.
Nike has not acknowledged significant criticism for its basketball uniforms. LaRocca said, “you’ll certainly see fresh new products on a regular basis from them.”
Nike has had a demanding partnership with the NBA since 1992 — and with the WNBA since its 1997 founding — and the brand endorses most of the combinations’ biggest players, including LeBron James, Kevin Durant, Caitlin Clark and Sabrina Ionescu.
As of Friday’s guarded, Nike’s stock has fallen about 24% this year and has underperformed both competitors and the S&P 500, which has gained adjacent to 23% this year. On Running and Deckers, two companies that have been taking market share from Nike, are up 79% and 43%, separately.
Historically, Nike has outperformed the S&P 500 by an average of about 8%.