Why Nike is Betting Big on Innovation to Reverse Decline

Nike is battling hard to reverse a steep decline.

The sportwear giant experienced a 10% fall in revenue in its 2025 fiscal year, which ended in May. Revenue for that 12-month period stood at US$46.3bn, down from US$51.4bn in 2024.

Back in March, Matt Friend, Chief Financial Officer at Nike, spoke about the challenge of navigating "external factors that create uncertainty in the current operating environment", pointing to tariffs and macroeconomic forces affecting consumer confidence.

In response, CEO Elliott Hill opted for price hikes across various items of clothing and footwear, forming part of a bold turnaround strategy.

Despite reporting a 31% fall in earnings at the end of September, the company appears to be weathering the storm. Revenue was up 1% year on year to US$11.7bn, surpassing the consensus estimate of US$11bn. 

Behind the scenes, Nike is pursuing a host of game-changing innovations, spearheaded by Chief Innovation, Design and Product Officer Phil McCartney. 

Athlete-centred innovation

Nike is bringing together its Innovation, Design and Product teams across Nike, Jordan Brand and Converse into a single operation aimed at streamlining athlete-first development.

The newly-unified structure aligns with the company’s Sport Offense model, designed to speed up innovation and improve coordination across its global supply chain and manufacturing networks.

Nike's aim is clear: to help product teams work more closely together, share ideas more easily and apply new technologies more quickly to the needs of athletes worldwide. The company says this integrated model sharpens its focus on delivering gear that solves athlete problems and supports performance at every level.

"Our north star is a homage to our co-founder Bill Bowerman and a challenge Kobe Bryant put to all of us: 'create epic s--- and make athletes better,'" says Phil.

By bringing together its three brands' creative teams under one structure, Nike intends to strengthen its capacity to develop performance-driven products at scale while maintaining close links with elite and everyday athletes.

A new model for innovation delivery

The Sport Offense model groups Nike’s core performance-focused functions under a single umbrella to improve end-to-end delivery across product development. It's hoped the structure will enhance its ability to move from concept to market faster, while keeping athlete insights at the centre of every design.

"Everything begins and ends with the athlete’s voice – their goals, their struggles, their drive," continues Phil. 

"By uniting our creation organisation across Nike, Jordan and Converse, we’re accelerating progress and fully leveraging our strengths to deliver epic products that make athletes better. It’s a new day in Innovation, Design and Product at Nike."

The approach ties into a broader push by Nike to use its extensive research and data capabilities more efficiently. It also signals tighter collaboration between internal teams and external supply chain partners, particularly in footwear and apparel manufacturing.

Focus on performance, mindset and energy efficiency

Alongside the structural shift, Nike has launched four new innovation platforms, with each designed to address specific performance needs through novel materials or technology.

All four have been developed with input from athletes and refined through the work of specialised internal teams and global partners:

• Aero-FIT is Nike’s newest cooling system for apparel. The company claims it delivers more than double the airflow of previous gear, tailored for extreme conditions.
• Nike Mind is a neuroscience-based footwear platform developed over 10 years. It debuts with two products — Mind 001 and Mind 002 — designed to support mental preparation and recovery before and after events.
• Project Amplify introduces powered footwear to everyday running and walking. Nike says the platform is built to help people move farther and faster with less physical effort.
• Therma-FIT Air Milano integrates Nike Air technology into outerwear. According to the brand, it allows athletes to regulate temperature without removing layers — offering warmth similar to a hoodie up to a mid-weight puffer.

Each platform reflects the company’s commitment to athlete-led innovation, combining physical comfort, mental readiness and performance support into modular systems for elite and amateur sportspeople alike. 

Advanced research, design and manufacturing

Nike credits its global network of thousands of designers, researchers and manufacturing partners with turning high-level concepts into scalable products.

Many operate from the Serena Williams Building, a one-million-square-foot facility on Nike’s Philip H. Knight Campus, and work closely with specialists at the LeBron James Innovation Center, which houses the Nike Sport Research Lab.

Also involved are bioengineers and neuroscientists focused on human performance, plus teams at the Bowerman Footwear Lab, where many product prototypes are created and tested before scaling to production.

"Our curious, talented teammates who come together to serve athletes every day, combined with our advantaged resources like the Nike Sport Research Lab, will enable us to deliver future decades of disruptive products and performance breakthroughs," adds Phil. 

“What comes out of our creation teams isn’t just innovative – it’s the kind of work that stops people in their tracks. It wows; it resonates; it makes people feel something. And that’s the magic.”

Phil concludes: “We are a team of dreamers, designers and creators with a responsibility to make athlete dreams real.

"We focus on the athlete’s unique relationship with their sport, creating solutions they never knew they needed and can’t live without. We imagine and innovate – always starting with athletes, staying grounded in sport and pushing what’s possible in innovation, design and product."