Nike‘s full-year revenue remained flat, with an analyst pointing out that the footwear and apparel brand is losing market share.

The company’s annual revenue stood at $51.36 billion while net income rose 12 per cent to $5.7 billion.

Nike brand’s revenue slightly rose by 1 per cent to $49.3 billion. Nike’s direct revenue also increased by 1 per cent to $21.5 billion.

Wholesale revenue climbed 1 per cent to $27.8 billion while Converse revenue fell 14 per cent to $2.1 billion due to declines in North America and Western Europe.

In the fourth quarter, group revenue fell 2 per cent to $12.6 billion while net income surged 45 per cent to $1.5 billion.

Neil Saunders, MD at GlobalData, said Nike took it too far in pushing direct-to-consumer sales and underestimated the importance of third-party retailers.

“This withdrawal opened the door for those retailers to partner more closely with other brands. Although Nike is now rebuilding these relationships, it is still suffering from the exposure it essentially gifted to other brands,” said Saunders.

He also blamed Nike’s weak fiscal performance on a relative lack of innovation and storytelling.

“As Nike has fallen back, other brands like On and Hoka have taken up the cudgel of innovation with sneakers that are appealing to consumers, and which are woven around interesting stories about the founders and their heritage,” said Saunders.

“Naturally, these brands are much smaller than Nike so their outsized growth rates are not ones that the king of the sports market can match. However, the worry is that they are gaining market share at a time when Nike is losing it.”

Nike EVP and CFO Matthew Friend said the fiscal fourth quarter highlighted the challenges that prompted the company to revise its outlook for the current year.

“We are taking actions to reposition Nike to be more competitive, and to drive sustainable, profitable long-term growth,” said Friend.