Trump's tariff war could cost Nike $1 billion
Faced with declining sales, the American sports shoe and clothing manufacturer has announced that it will reduce its production in China to mitigate the impact of the customs dispute between Beijing and Washington while increasing its consumer prices.
Nike is quick to point to Donald Trump's customs policy as the reason for the upcoming difficulties. According to the American sports shoe and clothing manufacturer, "the tariffs imposed by the US president on its main trading partners could increase its costs by around $1 billion [€850 million] this year," reports the BBC .
The company's executives also announced that they would "reduce the share of goods produced in China to mitigate the effects of US trade policy," the British media outlet continues.
Already last May, the sportswear specialist had explained that it had no other choice but to increase its prices on “certain sports shoes and certain clothing in the United States starting in June,” following similar statements from its competitor Adidas.
However, thanks to a “less significant than expected” decline in its first-quarter revenue forecast, CNBC points out , the manufacturer's shares rebounded 10% late Thursday. The decline “in its sales and profits is easing” since the beginning of the year, “after the biggest financial shock suffered by the athletic shoe giant in the fiscal fourth quarter [the first quarter of 2025].”
“Although the worst may be over,” the US business outlet continues, Nike “must face the new challenges of tariffs, making its recovery even more difficult.” Matt Friend, Nike’s chief financial officer, estimates that “with the new tariffs in effect today, the increase in Nike’s gross costs would be approximately $1 billion.”
Hence the efforts to reorganize its production chain, 16% of which is still located in China today. The company plans to reduce this percentage to single digits by the summer of 2026.
While the American giant had boasted a profit of $1.5 billion in the first quarter of 2024, this fell to $211 million in the first quarter of 2025, and sales, down 12% compared to last year, stood at $11.10 billion. Matt Friend did not hide the “financial impact” of these poor quarterly results but asserted that “the headwinds should calm down in the future.”
Courrier International
