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The pending removal of retail giant Nike (NKE) from the S&P 100 (^SP100) and Lululemon's (LULU) downtrodden earnings report last week have delivered fresh reminders that two of the athletic-wear industry's most powerful brands are no longer in the pole position they once were.
Nike will exit the index — intended for the largest blue-chip companies in the US stock market — before the opening bell on Sept. 21, ending a roughly 18-year run. Though it will remain in the broader S&P 500 (^GSPC), the demotion from the more rarified S&P 100 follows a prolonged decline that has wiped out more than three-quarters of Nike's stock-market value since its 2021 peak.
Lululemon, meanwhile, fell to its lowest level in eight years last week after reporting another quarter of weakening demand and cutting its annual forecast, laying out a tough path ahead for new CEO Heidi O'Neill. The company's second quarter revenue declined 4% from a year earlier to $2.42 billion, while comparable sales fell 9%.
"The problem for both Nike and Lululemon is that they're market leaders in their respective segments," Neil Saunders, managing director at GlobalData Retail, told Yahoo Finance. "That means there is a lot of surface area to defend from competitors."