Nike shares sell off after basketball star's shoe breaks live on TV
Nike's shares sold off today after a pair of the sneaker company's shoes malfunctioned during a live televised NCAA game, injuring the NBA's No. 1 basketball prospect.
Duke University star Zion Williamson was injured 33 seconds into a game Wednesday evening when his shoe, Nike PG 2.5, broke and caused him to lose his footing.
After the game, team officials described the injury to Williamson, the likely NBA top draft pick next season, as a "mild sprain." But the pain inflicted on Nike's reputation could also water the eyes of some investors.
Company shares were changing hands Thursday down almost two per cent from Wednesday's close, at just over $83 a share.
"At this juncture, we are optimistic that while negative headlines might weigh upon Nike shares for a bit, any lasting damage to the company and its shares will prove minimal," Oppenheimer analyst Brian Nagel said in a note.
Attention to the incident was perhaps more than it would normally have been because the mishap happened during a nationally televised prime-time game against Duke archrival North Carolina.
"We are obviously concerned and want to wish Zion a speedy recovery," Nike said in a statement.
"The quality and performance of our products are of utmost importance. While this is an isolated occurrence, we are working to identify the issue."
It's not the company's only shoe-related mishap of late.
Nike's high-profile smart sneakers, the Air Adapt BB, launched this month to much fanfare largely because they don't have laces. To tie them, owners of the $350 US battery-powered sneakers connect to an app on their smartphone to log in and adjust the fit.
But people who use Android phones to connect with their shoes have flooded the company's app store with complaints that the app doesn't connect with the shoes as promised, making them impossible to tighten.
"We are aware of the issue and are actively working on a solution," Nike is telling customers. "We apologize for any inconvenience."
