Li Ning Faces Sharp Decline in Market Value Amid Strategic Uncertainty and Brand Challenges

Li Ning's market capitalization has fallen dramatically from its peak of HK$280 billion in 2021 to HK$43 billion, marking an 84% decline within just a few years. In contrast, ANTA, despite experiencing some fluctuation, remains significantly ahead with a current market valuation of HK$254.6 billion—six times that of Li Ning. Although the recent signing of NBA rookie Yang Hansheng briefly lifted Li Ning’s stock price, the company’s deeper challenges suggest that relying on athlete endorsements alone may not offer a sustainable recovery path.

While Li Ning has a history of leveraging high-profile athlete partnerships—most notably with NBA star Dwyane Wade—the long-term brand impact of such strategies appears to be diminishing. Following Wade's retirement in 2019, the influence of the “Way of Wade” series visibly declined. Since then, Li Ning has signed several NBA players including Russell, CJ McCollum, Fred VanVleet, and Jimmy Butler, yet none have significantly strengthened the brand’s presence. In 2023, Li Ning’s basketball category revenue dropped by 21%, and the company’s net profit declined 5.46% to 3.013 billion yuan, despite a 3.9% increase in total revenue to 28.68 billion yuan.

Comparatively, ANTA reported 70.826 billion yuan in revenue for 2024, a 13.6% year-on-year increase, and an operating profit of 16.595 billion yuan, up 8%. Xtep recorded revenue of 13.577 billion yuan and a 20.2% increase in net profit to 238 million yuan, while 361° posted 10.07 billion yuan in revenue and a 19.5% increase in net profit to 1.149 billion yuan. Li Ning was the only major player among them to report a year-on-year net profit decline for two consecutive years, following a 21.58% drop in 2023.

Strategic inconsistency has compounded these financial challenges. Li Ning has oscillated between slogans—“Anything is Possible” in 2002, “Make The Change” in 2010, and a return to its original branding in 2015—causing market confusion about its core identity. The brand’s multi-line strategy has led to a proliferation of sub-brands including “China Li Ning,” “Li Ning YOUNG,” “LNG,” and “Li Ning 1990.” However, these offerings often lack clear differentiation, creating ambiguity in consumer perception.

Meanwhile, product pricing has increased significantly. Since 2018, Li Ning’s footwear prices have risen by 20–30%, with some premium offerings, such as “Li Ning 1990” down jackets, reaching 6,000 yuan. The “Super Light” series rose from 499 yuan in 2018 to 599 yuan in 2021, and the “Liejun” line increased from 699 yuan in 2020 to 1,099 yuan in 2023. Yet, its R&D expenditure in 2024 stood at only 676 million yuan, representing less than 2.5% of total revenue. In contrast, ANTA invested 2 billion yuan, accounting for 2.8% of revenue, while global players like Nike and Adidas typically allocate 10–20%.

In addition to product and strategy issues, repeated public relations missteps have further eroded consumer trust. In a recent campaign involving Olympic champions, Li Ning faced backlash over the perceived marginalization of Quan Hongchan in promotional materials, prompting high refund rates of up to 72%. The brand’s response—deleting comments and offering no public explanation—amplified the negative sentiment. Similar criticism followed the 2022 “aviator cap incident,” when Li Ning was accused of producing designs with inappropriate stylistic references. Company executives defended the designs, leading to further public discontent and a decline in stock price.

Despite having once declared that it aspired to become not just “China’s Nike,” but “the world’s Li Ning,” the company now faces the urgent task of regaining consumer confidence and redefining its market position. At a lecture on June 15 at Beijing Sport University, Li Ning stated that failure is a foundation for growth and that sports teach resilience. For the company, acknowledging its current challenges and committing to reform may be the first step toward recovery. The opportunity presented by Yang Hansheng’s NBA entry is valuable, but enduring success will require deeper changes in strategy, product development, and brand management.