Nike stock jumped after Trump announced that the U.S. has reached a trade deal with Vietnam. Footwear stocks, led by Nike (NKE), moved higher in morning trading on Wednesday after President Trump posted on Truth Social that he “made a Trade Deal with Vietnam.”
Nike, On Holding (ONON), Deckers (DECK), and Lululemon (LULU) all spiked following the news.
However, retail and footwear stocks pulled back slightly after Trump shared more details of the agreement. In a follow-up post, he said Vietnam would pay a 20% tariff on all goods shipped to the U.S. and a 40% tariff on goods subject to transshipping—products routed through Vietnam from countries like China.
Nike shares initially surged as much as 4% but settled to a gain of about 1.7% by mid-morning. On Holding led the pack, up more than 3.5%, while Deckers and Lululemon saw modest gains.
Many leading footwear brands have already shifted much of their sourcing from China to Vietnam in recent years, aiming to diversify supply chains amid escalating trade tensions during Trump’s first term.
Nike recently told investors that it expects to incur nearly $1 billion in tariff-related costs as it continues moving production away from China. Currently, about 16% of its U.S. shoe imports come from China, a figure the company aims to reduce to the “high single-digit range” by fiscal year-end. Nike also announced a “surgical price increase” for the U.S. market, scheduled to begin this fall.
Last month, Lululemon shares suffered their worst single-day drop since 2020 after warning that profits would be pressured by a “dynamic macro-environment,” citing tariff uncertainties and weaker consumer demand.
Recently Nike had said widespread tariffs will likely cost the company $1 billion.
Nike manufactures nearly all of its athletic clothes and shoes in other countries. In April, Trump began levying import taxes on goods made in other countries. Companies like Nike have to pay the tariff to the American government when its products hit the port of entry.
“With the new tariff rates in place today, we estimate a gross incremental cost increase to Nike of approximately $1 billion,” Matthew Friend, chief financial officer at Nike, told investors during Thursday’s earnings call. “We intend to fully mitigate the impact of these headwinds over time.”
It’s unclear how long the Trump administration will keep the tariffs in place, but Nike’s plan includes spreading out the $1 billion cost over the next year.
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