At the peak of his career, Michael Jordan was the favorite of renowned brands, including Nike. In 1984, he signed a deal with Nike that would later give birth to Air Jordan. Before inking a deal with Nike, the brand played second fiddle to brands like Adidas, Reebok, and Converse.
At the time, Adidas was 50 percent larger in revenue, and Reebok was doing better in the market than Nike. Converse, on the other hand, was the brand choice for many NBA stars, including Jordan and upcoming players like Larry Bird and Julius Erving, according to Forbes.
Jordan wore Converse during his time at the University of North Carolina and was about to sign with Adidas when the Bulls first drafted him. However, his agent, David Falk, wanted him to join Nike owing to his close relationship with the brand.
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Jordan told them that he was not interested. Falk then appealed to his mother, Deloris, to convince the then-21-year-old to join Nike. Jordan eventually accepted Nike’s deal and, from there, started working on his own shoe brand. This led to the birth of Air Jordan.
Nike first offered Jordan a five-year deal with a base pay of $500,000 per year, triple any other NBA sneaker deal, according to Forbes. The first Air Jordan sneaker was an instant hit, racking up $126 million in sales in the first 12 months.
Since then, the Jordan brand has been a cash cow for Nike. In its most recent earnings report, Jordan Brand saw its sales increase by 6 percent, reaching $7 billion in revenue for fiscal year 2024, according to Boardroom. This made the brand, now led by Sarah Mensah, the best performer of all the company’s divisions.
Meanwhile, Nike reported fiscal year 2024 revenues at $51.4 billion, a 1% increase from the previous year, according to Boardroom. Its fourth-quarter revenues were however $12.6 billion, a 2% decrease.
“We are taking our near-term challenges head-on while making continued progress in the areas that matter most to NIKE’s future: serving the athlete through performance innovation, moving at the pace of the consumer, and growing the complete marketplace,” said John Donahoe, Nike’s president and CEO, in an earnings release. “I’m confident that our teams are lining up our competitive advantages to create greater impact for our business.”
The Jordan brand reached $4.7 billion in fiscal year 2021 and earned $5 billion the following fiscal year.
