VOL. XCIV, NO. 247
★ MOAT STOCKS & COMPETITIVE ADVANTAGES ★
PRICE: 5 CENTS
Tuesday, December 23, 2025
NIKE, Inc.
NKE · New York Stock Exchange
Weighted average of segment moat scores, combining moat strength, durability, confidence, market structure, pricing power, and market share.
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Overview
NIKE, Inc. is a global athletic and casual footwear/apparel company whose moat is primarily demand-driven: brand trust reinforced by innovation and sports marketing/endorsements. Operationally, scale in sourcing and distribution supports cost competitiveness, while owned retail and digital platforms provide increasing distribution control and direct consumer relationships. In FY2025, total revenues were $46.309B with ~58% from wholesale and ~42% from direct-to-consumer, plus a small licensing/other bucket. Market cap was about $84.6B as of 2025-12-23 (Yahoo Finance).
Primary segment
Wholesale
Market structure
Competitive
Market share
—
HHI: —
Coverage
3 segments · 6 tags
Updated 2025-12-23
Segments
Wholesale
Branded athletic & casual footwear/apparel wholesale distribution
Revenue
57.8%
Structure
Competitive
Pricing
moderate
Share
—
Peers
Direct to Consumer (DTC)
Branded athletic & casual footwear/apparel direct-to-consumer retail and e-commerce
Revenue
42.1%
Structure
Competitive
Pricing
moderate
Share
—
Peers
Brand licensing & other
Brand licensing for footwear/apparel and miscellaneous revenue
Revenue
0.2%
Structure
Competitive
Pricing
moderate
Share
—
Peers
Moat Claims
Wholesale
Branded athletic & casual footwear/apparel wholesale distribution
FY2025 wholesale revenue was $26.758B (Note 14, 'Sales to Wholesale Customers'). Nike reports no single customer >=10% of consolidated revenues; top 3 U.S. customers were ~25% of U.S. sales. Source: https://www.sec.gov/Archives/edgar/data/320187/000032018725000047/nke-20250531.htm
Brand Trust
Demand
Brand Trust
Strength: 5/5 · Durability: durable · Confidence: 4/5 · 2 evidence
Global brand equity and athlete/league associations create consumer pull that supports shelf space and merchandising priority with wholesale partners.
Erosion risks
- Brand heat loss / fashion cycle
- Reputational damage (labor, ESG, product controversy)
- Counterfeit and brand dilution
Leading indicators
- Full-price sell-through vs markdown rate
- Wholesale futures orders / sell-in trend
- Brand search and social engagement trends
Counterarguments
- Consumers can switch brands with low friction if product cadence or storytelling weakens
- Premium challengers (e.g., On, HOKA, Lululemon) can take share in specific categories
Procurement Inertia
Demand
Procurement Inertia
Strength: 3/5 · Durability: medium · Confidence: 3/5 · 2 evidence
Retailers tend to keep Nike assortments due to sustained consumer demand and the risk of losing traffic if they drop key Nike franchises.
Erosion risks
- Retail partner consolidation increases buyer power
- Retailers shift shelf space to private label or faster-moving brands
- Marketplace and off-price channel mix increases
Leading indicators
- Top wholesale customer concentration
- Wholesale gross-to-net (returns/discounts) trends
- Wholesale order cancellations and returns
Counterarguments
- Retailers can reallocate shelf space quickly if Nike under-innovates
- Wholesale partners may demand higher discounts/returns provisions, weakening Nike's economics
Scale Economies Unit Cost
Supply
Scale Economies Unit Cost
Strength: 4/5 · Durability: medium · Confidence: 4/5 · 2 evidence
Large global sourcing footprint and volume across factories/suppliers can lower unit costs (materials leverage, logistics, and process repeatability), supporting gross margin versus smaller brands.
Erosion risks
- Tariffs / trade policy changes increase landed costs
- Supplier concentration (top manufacturers) creates disruption risk
- Freight/transportation volatility
Leading indicators
- Gross margin trend
- Freight and logistics cost indices
- Supplier concentration and factory utilization changes
Counterarguments
- Large competitors can access similar contract manufacturers and raw materials
- Scale does not fully protect margins when inventory is cleared through discounting
Direct to Consumer (DTC)
Branded athletic & casual footwear/apparel direct-to-consumer retail and e-commerce
FY2025 direct-to-consumer revenue was $19.477B (Note 14, 'Sales through Direct to Consumer'). Nike reports owned digital commerce platforms in 40+ countries and a sizable owned-store footprint (e.g., 376 U.S. stores and 658 non-U.S. stores across NIKE Brand + Converse). Source: https://www.sec.gov/Archives/edgar/data/320187/000032018725000047/nke-20250531.htm
Distribution Control
Supply
Distribution Control
Strength: 4/5 · Durability: medium · Confidence: 4/5 · 2 evidence
Owned stores and Nike-owned digital platforms give Nike control over merchandising, storytelling, inventory allocation, and consumer data capture versus relying solely on third-party retailers.
Erosion risks
- Consumer traffic shifts to marketplaces and multi-brand retailers
- Rising digital customer acquisition costs
- Execution risk in store productivity and digital conversion
Leading indicators
- DTC revenue share
- Nike-owned digital traffic and conversion
- Comparable store sales and store productivity
Counterarguments
- Consumers have low switching costs between brand sites/apps
- DTC growth can cannibalize wholesale and trigger partner pushback
Ecosystem Complements
Network
Ecosystem Complements
Strength: 3/5 · Durability: medium · Confidence: 3/5 · 2 evidence
Digital services (apps/content) and retail experiences can reinforce product demand, repeat purchases, and membership engagement, improving direct channel economics over time.
Erosion risks
- Consumers multi-home across competing fitness/content apps
- Data privacy regulation limits personalization
- App engagement stagnation reduces ecosystem value
Leading indicators
- Membership growth and active users
- App MAU/DAU and engagement time
- Repeat purchase rate / cohort repurchase
Counterarguments
- Fitness and commerce apps are fragmented; network effects are weak and users can switch easily
- Content/services may not translate into incremental product purchases in downturns
Brand Trust
Demand
Brand Trust
Strength: 5/5 · Durability: durable · Confidence: 4/5 · 1 evidence
Brand-driven demand makes Nike's owned channels a destination, supporting higher conversion and the ability to launch/allocate limited products.
Erosion risks
- Brand heat loss / fashion cycle
- Reputational damage
- Counterfeit and resale dynamics affecting brand perception
Leading indicators
- Direct channel traffic and conversion
- New product launch sell-through
- Price realization (ASP) and discount rate
Counterarguments
- Brand strength is not sufficient when product innovation misfires
- Aggressive promotions can train consumers to wait for discounts
Brand licensing & other
Brand licensing for footwear/apparel and miscellaneous revenue
FY2025 'Other' revenue was $74M in Note 14 and includes Nike Brand licensing/miscellaneous revenues and Converse licensing, net of certain corporate FX hedging impacts. Source: https://www.sec.gov/Archives/edgar/data/320187/000032018725000047/nke-20250531.htm
IP Choke Point
Legal
IP Choke Point
Strength: 3/5 · Durability: durable · Confidence: 4/5 · 2 evidence
Trademark and patent portfolio supports licensing economics and deters direct copycat branding, though enforcement is imperfect.
Erosion risks
- Counterfeit and gray-market leakage
- IP enforcement and litigation costs
- Licensee quality issues harming brand
Leading indicators
- Trademark litigation outcomes / enforcement actions
- Counterfeit seizure and takedown trends
- Royalty revenue trajectory
Counterarguments
- Licensing economics depend heavily on brand relevance, not just legal protection
- Over-licensing can dilute brand equity
Evidence
NIKE is the largest seller of athletic footwear and apparel in the world.
Supports the claim that NIKE is a leading global brand in its core category.
Identification with prominent and influential athletes, influencers, public figures, sport teams and leagues.
Nike highlights endorsement/association as a competitive factor underpinning consumer affinity.
We sell our products through two distribution channels: to wholesale accounts ...
Documents the importance and breadth of Nike's wholesale channel relationships.
Our three largest United States customers accounted for approximately 25% of sales in the United States.
Shows concentration among major wholesale partners and the embedded nature of these relationships.
Contract manufacturers operated 97 finished goods footwear factories located in 11 countries.
Shows a large, diversified manufacturing footprint that benefits from scale.
Showing 5 of 13 sources.
Risks & Indicators
Erosion risks
- Brand heat loss / fashion cycle
- Reputational damage (labor, ESG, product controversy)
- Counterfeit and brand dilution
- Athlete/league endorsement backlash
- Retail partner consolidation increases buyer power
- Retailers shift shelf space to private label or faster-moving brands
Leading indicators
- Full-price sell-through vs markdown rate
- Wholesale futures orders / sell-in trend
- Brand search and social engagement trends
- Share of voice in key sports (running, basketball, soccer)
- Top wholesale customer concentration
- Wholesale gross-to-net (returns/discounts) trends
Curation & Accuracy
This directory blends AI‑assisted discovery with human curation. Entries are reviewed, edited, and organized with the goal of expanding coverage and sharpening quality over time. Your feedback helps steer improvements (because no single human can capture everything all at once).
Details change. Pricing, features, and availability may be incomplete or out of date. Treat listings as a starting point and verify on the provider’s site before making decisions. If you spot an error or a gap, send a quick note and I’ll adjust.