Nike Faces $1B in Added Costs from Tariffs

Nike is facing a critically important financial challenge, with estimates suggesting that tariffs imposed during the Trump administration could lead to losses of around $1 billion. This facts comes from a recent report by The Guardian, where CFO Matthew Friend described these tariffs as “a new and meaningful cost headwind” for the company.

As per The Guardian, during a call with analysts on June 27, Friend indicated that Nike plans to tackle these increased costs by diversifying its supply chain away from China and implementing price hikes for consumers. Currently, about 16% of Nike’s footwear imports into the U.S. come from China, but the company aims to reduce this figure to below 10% by the end of fiscal year 2026. Starting this fall, customers can expect what Friend referred to as “surgical price increases” on select products.

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Nike recently reported its lowest quarterly earnings in three years for Q2, with revenues falling by 12% to $11.1 billion. A survey conducted by Plant Tours revealed that over half of the 500 manufacturing professionals questioned noted that tariffs have slashed their profit margins by up to 15%, leading three-quarters of them to pass these costs onto consumers. additionally, research from k-ecommerce involving 1,000 U.S.shoppers found that nearly half (44%) have cut back on spending overall while more than one-third (36%) are postponing purchases of non-essential goods.