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Athletic-gear retail chain Foot Locker Inc. on Monday said it had “revitalized” its decades-long relationship with Nike Inc. to focus on basketball and sneaker culture and cultivating the “next generation of sneaker enthusiast” — moves that executives said could start to pay off later this year.
The remarks were made at an investor presentation after Foot Locker
FL,
reported a weaker outlook, as retailers deal with more muted demand for goods amid recession worries and rising prices for necessities that have have slowed consumer spending.
Both companies in recent years have tried to be less dependent on each other for sales. However, Foot Locker pitched the partnership as “complementary” to Nike’s
NKE,
efforts to sell more shoes and other gear directly to consumers — via online sales and its own stores — and harness better market planning, loyalty and data.
Foot Locker said it expected Nike to make up 55% to 60% of the chain’s revenue in 2026. That would be lower than around 70% of sales in prior years.
Foot Locker Chief Executive Mary Dillon, during the presentation, said the “fruits of our renewed commitment to one another will begin to show up in holiday this year as we build increasing momentum to 2024 in the 50th anniversary of Foot Locker.”
“We are partnering across planning and loyalty to develop an integrated marketplace,” she added later. “The revitalized alignment has positioned Nike and Foot Locker to return to growth in 2024.”
She said starting in this year’s holiday season, Foot Locker would be highlighting LeBron and KD retro shoes, along with LeBron signature shows and Air Force 1 offerings. She also said that next year, both companies would partner on “on an exclusive product concept celebrating Foot Locker’s 50-year anniversary.”
Nike last year struggled with a staggered supply chain and efforts to cut prices and unload off-season clothing. However, the shoe maker’s quarterly results in December were better than expected. Nike reports its third-quarter earnings on Tuesday.
Shares of Foot Locker finished 5.7% lower on Monday, while Nike gained 0.7%.
Foot Locker stock is up 28.5% over the past 12 months, while Nike has gained 3.6%. By comparison, the S&P 500 Index
SPX,
has fallen 11.4% over that period.
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