The brand is facing unprecedented headwinds spurred by Adidas and Under Armour making progress, according to analysts at Morgan Stanley.
"Adidas' resurgence, Under Armour's basketball gains, and the weak US athletic apparel environment remain headwinds for Nike," the analysts write.
Nike's earnings per share growth has stalled. Inventories are starting to pile up, indicating that Nike isn't clearing out all the merchandise it is making.
Meanwhile, Nike's competitors are gaining share. During the Olympics, Adidas and Under Armour shares rose far more than Nike stock.
While Nike's $30 billion in annual revenues far surpasses Adidas ($18 billion) and Under Armour ($3.96 billion), this chart from Morgan Stanley illustrates how Nike is losing share in footwear and clothing.
Morgan Stanley
Adidas has put itself back on the map by reviving its classic Stan Smith, Superstar, and Gazelle sneakers. The buzz around Adidas has resulted in more customers buying the brand's running shoes, too.
Under Armour is also gaining in the basketball shoe category, thanks to an endorsement from NBA MVP Steph Curry.
The company's net revenue from footwear for the second quarter grew 58% in a year, led by the Steph Curry line.
In addition to making strides in footwear, Adidas and Under Armour are doubling down on apparel investments.
Under Armour hired designer Tim Coppens to craft a luxury athleisure line. Adidas is also launching a new clothing line.
While both brands have a long way to go before catching up to Nike, it seeems clear they are a growing threat.