Nike (NKE) Shares Plunge 9% as ON Semiconductor Closes $5.7B Synaptics Deal

TLDR

• Nike shares tumbled approximately 9-10% following a revenue shortfall in Q1 and disappointing annual projections.
• ON Semiconductor finalized a $5.7 billion all-cash acquisition of Synaptics, replacing an earlier $7 billion stock-based proposal.
• Synaptics stock surged roughly 14% after the revised acquisition terms were announced.
• Moderna is scheduled to enter the Nasdaq 100 index on October 9, taking Warner Bros. Discovery’s spot.
• Equity futures advanced Friday as market participants awaited the September employment data.

U.S. stock futures posted gains Friday morning as investors positioned themselves ahead of the September employment report, a key data point that may influence the Federal Reserve’s upcoming monetary policy decisions.

Nike emerged as one of the session’s biggest losers during premarket hours. The athletic apparel giant’s shares plummeted between 9% and 10% following disappointing quarterly earnings.

NIKE, Inc., NKE

Nike Reports Revenue Decline and Lowers Full-Year Projections

Nike reported an $11 billion revenue figure for the quarter, representing a 4% decline compared to the same period last year. The result came in below Wall Street’s consensus estimates.

The Greater China market experienced a sharp 22% year-over-year contraction, generating just $1.2 billion in sales. The Converse subsidiary saw revenue plunge 28%, while Nike Direct channels declined 8%.

Wholesale distribution channels also weakened by 1%. The broad-based weakness suggests challenges throughout Nike’s entire business model.

Management now anticipates full-year revenue will contract by a high single-digit percentage. Adjusted earnings per share are projected to land between $1.15 and $1.35 for the year.

This guidance excludes approximately $0.15 per share in restructuring charges. The forecast significantly trails analyst expectations of $1.67 per share.

The company’s turnaround initiative, known as PACE, targets approximately $2.5 billion in cost reductions extending through 2031. Roughly $1 billion of these savings will come from workforce-related expenses.

ON Semiconductor Revises Synaptics Acquisition Terms

ON Semiconductor stock climbed between 4% and 6% after unveiling a revised agreement to purchase Synaptics. The updated transaction is structured as an all-cash deal worth $5.7 billion.

The offer represents $123 per share for Synaptics shareholders. This replaces the June announcement of an all-stock transaction that carried a $7 billion valuation.

The restructured deal came after a competing bidder submitted an unsolicited proposal for Synaptics. ON Semiconductor indicated the cash transaction should be immediately accretive to adjusted earnings per share.

Financing for the acquisition will combine existing cash reserves with debt facilities provided by Morgan Stanley. The transaction timeline remains unchanged, with completion expected around mid-2027.

Synaptics’ board of directors unanimously endorsed the modified terms. Synaptics shares rallied approximately 14% in premarket trading following the announcement.

In related semiconductor news, ChronoScale Holdings advanced about 6%. The firm disclosed new and enhanced contracts with AI infrastructure clients, projecting an annualized revenue run rate of $1 billion by Q3 2027.

ChronoScale also confirmed it finalized the divestiture of its Ekso Bionics division. The strategic move allows the company to concentrate resources on its core AI infrastructure operations.

Moderna Gains Nasdaq 100 Inclusion

Moderna stock increased nearly 2% after Nasdaq confirmed the biotechnology company will be added to the Nasdaq 100 index. The inclusion becomes effective prior to the opening bell on October 9.

Moderna will take the position currently held by Warner Bros. Discovery. Warner Bros. is anticipated to finalize its combination with Paramount Skydance within the next several days.

In additional trading activity, Venture Global shares edged higher. ConocoPhillips committed to purchasing 1 million metric tons of liquified natural gas annually from Venture Global for 20 years beginning in 2030.