On September 18, 2026, Reuters reported that French soccer star Kylian Mbappe ended a two-decade partnership with NIKE, Inc. (NYSE:NKE) to sign with Swiss sportswear brand On in a deal. It includes both cash and equity that gives On Holding AG (NYSE:ONON) its first major star as it pushes into soccer for the first time.
A source told CNBC that Nike chose not to renew Mbappe’s contract as it expired in July 2026, deciding to direct its endorsement spending elsewhere.
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Bull Case
On Holding AG (NYSE:ONON) gains immediate global credibility for its first expansion into soccer. Kylian Mbappé gives On a marquee athlete before it launches its first soccer boots in 2027. Thierry Henry provides category expertise as director of football. Together with Roger Federer’s backing, these relationships back up On’s strategy of using elite athletes to enter new sports and reduce its reliance on running shoes.
The cash-and-equity structure aligns Mbappé with On’s long-term success. Equity gives Mbappé a direct financial interest in building the brand rather than simply collecting a fixed endorsement payment. His global profile could help On attract younger customers, retailers, and soccer talent as it develops footwear using technologies such as its robotic LightSpray manufacturing process.
NIKE, Inc. (NYSE:NKE) retains a powerful soccer platform despite losing Mbappé. Nike still supplies France’s national teams through the 2033-34 season and will become the German national teams’ official supplier in 2027. On and Nike shares barely moved after the announcement. It shows investors view the deal as strategically interesting for On but not immediately material to Nike’s overall financial position.
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Bear Case
On Holding AG (NYSE:ONON) must prove that expensive star power can generate profitable soccer sales. Nike, Adidas and Puma already dominate the category. Analysts warned that soccer requires substantial spending while performance credibility cannot simply be purchased. The financial terms remain undisclosed. However, the cash-and-equity structure could become costly if Mbappé raises awareness without producing enough footwear sales to justify the investment.
On enters soccer while its core Americas business already faces pressure. The Americas contribute more than half of On’s revenue, but uncertain consumer spending has slowed the region; the company recently missed second-quarter sales estimates, and its shares have fallen approximately 40% in 2026. Its price-to-earnings ratio still exceeds those of major sportswear competitors. It leaves limited room for execution problems or another growth disappointment.
Mbappé’s departure adds to a troubling pattern for Nike’s soccer business. NIKE, Inc. (NYSE:NKE) has also lost Lamine Yamal to Adidas and the Premier League match-ball contract to Puma, while Adidas gained valuable exposure by supplying both teams in the 2026 World Cup final. Since CEO Elliott Hill has identified soccer as a priority in Nike’s turnaround, repeated losses of athletes, contracts and market share could weaken confidence in the recovery even if no single defection materially changes revenue.
Hedge Fund Sentiment
NIKE, Inc. (NYSE:NKE)’s hedge fund count fell to 56 in the second quarter from 71 in the first, even as position value rose to $1.35 billion from $1.31 billion, according to Insider Monkey’s database. On Holding AG (NYSE:ONON), the beneficiary of the Mbappe signing, saw its own holder count rise to 54 from 52, with position value climbing to $2.31 billion from $1.40 billion.
Conclusion
The agreement represents a larger strategic opportunity for On than an immediate financial threat to Nike. Mbappé gives On global recognition and credible entry into soccer. However, the company must convert that attention into profitable product sales while managing slowing growth in its most important region and the substantial cost of competing against established brands.
For Nike, losing Mbappé damages its soccer narrative at an awkward point in Elliott Hill’s turnaround, especially after other athlete and sponsorship losses. Nonetheless, Nike retains major federation agreements, global distribution and a broad athlete portfolio, so this departure alone does not fundamentally weaken the investment case.
Investors should watch On’s 2027 soccer-boot launch and Americas growth, while judging Nike primarily on product innovation, market-share stabilization and whether further marquee athletes leave the brand.
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