PARIS – Nike picked the Palais Brongniart, the former home of the Paris stock exchange, as the venue for its most high-stakes product launch in years.

On display behind the Corinthian colonnade this past week was a barrage of new-product developments that the American athletic footwear and apparel corporation hopes can reignite its fortunes after a tough year.

There are improved track spikes, boots for footballers, a new basketball shoe and a new Alphafly built for marathoners.

But the main draws were the 41st iteration of Nike’s Pegasus shoes – the centrepiece of the company’s running business – and a premium version that it is aggressively fast-tracking to market.

“Force and speed are part of our machine going forward,” Ms Heidi O’Neill, Nike’s president of consumer and marketplace, said in an interview. “We cut almost an entire year off of the innovation.”

These shoes, unveiled ahead of the Paris Olympics set for July, kick off a three-year product development cycle that will shape Nike’s future, and there is a palpable sense of urgency among top management at the world’s largest sportswear retailer.

Nike has stumbled badly over the past several quarters, with a sales slowdown and inventory issues rattling its operations.

In December, chief executive John Donahoe laid out a plan to cut as much as US$2 billion (S$2.7 billion) in costs over the next three years, including layoffs that will slash 2 per cent of the company’s workforce.

Wall Street has been concerned about demand for Nike shoes, worrying that it is over-reliant on older models and is not releasing enough new goods quickly.

Nike expects revenue to fall by a low single-digit percentage in the first half of its fiscal year, which starts in June.

The stock was down 15 per cent in 2024 through the April 12 close.

Not living up to its potential

Mr Donahoe told investors and analysts in March that Nike is not living up to its potential, and that he will be making adjustments. He said Nike needs to refocus on sports and speed up product development to keep shoppers interested.

Ms Lorraine Hutchinson, an analyst at BofA Securities, wrote in a note to clients: “Management has acknowledged a need for big changes. Innovation has lagged in recent years, and new product development and launches are key to the return to growth.”

The running sector has been a particularly competitive category, with upstart brands from Switzerland’s On Holding and California-based Deckers Outdoor’s Hoka.

On broke US$2 billion in revenue in 2023, and Hoka’s annual sales are more than US$1 billion, taking a bite out of Nike’s market share.

Berkshire Hathaway’s Brooks Running is also coming off a record year, breaking US$1 billion in sales in North America alone.

In response, Mr Donahoe has vowed to refresh the Pegasus.

He said Nike would dial back supply of the existing version, along with classic kicks like Air Force 1 basketball shoes, to make room for newly developed items.

Mr John Hoke, Nike’s chief innovation officer, who was named to the new role in November, said: “Coming out of the pandemic, we became a little risk-averse. We have a very aggressive agenda.”

The beginning of that agenda was on show in Paris, with all hands on deck. Not all went smoothly, with the high-cut bottoms of one Nike design for a women’s US Olympic uniform drawing controversy.

Back at headquarters in Beaverton, Oregon, management had even called on Nike executive chairman Mark Parker, who stepped down as the company’s long-time CEO in 2020, to help with some of the finishing design touches for the new Pegasus.

That Pegasus 41, outfitted with new foam that meets the shoe’s usual air cushioning systems, is set to reach consumers in June through Nike’s online store and its retail partners. The Pegasus Premium, with a new full-length air layer, will come out in the spring of 2025.

Executives declined to share what else is planned for this vital multi-year cycle of new products.

Mr Hoke said Nike’s proprietary Air technology, used throughout many of its sneaker lines, is a top priority and a key differentiator.

Eyes will be on Nike’s sizable roster of athletes in several upcoming running competitions as well, as the shoe brands all try to prove their performance capabilities and compete for wins that might sway consumers who are on the fence.

The Boston Marathon is set for April 15, while the track events at the Paris Olympics are scheduled to begin on Aug 1.

“We’ve seen competitive situations before, and in a lot of cases, those competitors have come and gone,” said Ms O’Neill, the consumer president. “But maybe we’ve played it a little safe.” BLOOMBERG