With FIFA expected to attract at least 5 billion viewers, the world’s most popular football event is a huge opportunity for sportswear manufacturers to market their jerseys, shoes and other products to teams and individual players.
Adidas shares fell 6% during the month of the 2018 World Cup, when Germany, Adidas’ favorite team, was eliminated early and France won the tournament for Nike. Nike gained 4% over the same period, outpacing the S&P 500’s 1% gain.
On its quarterly conference call on November 9, Adidas said it expects World Cup-related sales of around 400 euros ($415 million), which will represent about 2% of additional annual revenue.
Nike did not immediately respond to a request for comment on the importance of the World Cup to its sales.
Although soccer-related products represent only a fraction of Adidas and Nike’s overall business, the hype surrounding the World Cup and team jerseys could have a halo effect that boosts sales of other types of products, Wedbush analyst Tom Nikic said.
“If someone in Germany buys a World Cup jersey, does he also buy a new pair of shoes? Or if a team sponsored by Adidas wins the whole thing, in the euphoria of winning the World Cup? That’s where you can see some of the variance,” Nikic said.
And Nike supplies 13 teams in this year’s Cup, including Brazil, France and the United States, with jerseys, overtaking Adidas in the lead in World Cup jerseys. Seven teams have been outfitted with adidas jerseys, including soccer powerhouses Germany, Spain and Argentina.
Six countries play in Puma jerseys, while New Balance and other companies make up the rest.
Four days after the start of the World Cup, Nike teams have accumulated 15 points, while Adidas teams have accumulated 11 points.
So far during the tournament, Nike shares are up more than 1%, while Adidas and Puma are down more than 3%.
The betting odds are currently in favor of Nike, Brazil and France, as the most likely to win the 2022 Cup.
Company Session Change Pct
Percentage change during the cup
Nike 0.6% 1.2%
Adidas AG 1.1% -3.8
Puma SE -0.2% -3.5