Nike (NKE  ) is on the verge of replacing Adidas AG (ADDYY  ) as the official match ball sponsor for the UEFA Champions League, thereby ending Adidas's 25-year dominance. Nike is in exclusive discussions to supply balls for all UEFA men's club competitions from 2027 to 2031, including the Europa League and Conference League, the Financial Times reported on Thursday.

The deal's value is expected to surge, potentially doubling to more than €40 million ($46.75 million) annually. This development marks a significant setback for Adidas, the Champions League ball supplier since 2001.

Adidas confirmed to the publication that it would not renew its role but will continue to supply other tournaments. Meanwhile, UC3, a joint venture between UEFA and the European Club Association, told Reuters that it is in talks with Nike.

Nike did not immediately respond to Benzinga's request for comment.

Nike Eyes Football Growth Amid Earnings

For Nike, overtaking Adidas underscores its growing ambitions in football, especially after Puma AG (PMMAF  ) replaced it as the official match ball supplier for the Premier League this season. Nike's CEO, Elliott Hill, during the company's latest earnings call, highlighted football's potential, viewing the upcoming FIFA World Cup as an opportunity to "catalyse the football marketplace for quarters to come".

This development comes on the heels of Nike's Q3 earnings beat. Despite flat year-over-year revenue growth, Nike managed to beat analyst estimates, with revenues of $11.28 billion and earnings of 35 cents per share. While the company's performance in China was better than feared, that in EMEA was worse than expected.

According to analysts at Needham, China continues to be "a pressure point" due to "unhealthy inventory levels."

Inventory Clearance To Drive Growth

Amid short-term pressures, the company is actively clearing out excess classic footwear franchises to make room for fresh innovation, as noted by Hill. This move was part of a broader strategy to improve the health and quality of their business.

He said the aggressive inventory clearing created a roughly five-point drag on results but was an "intentional" and necessary step to strengthen the marketplace and support long-term growth. While the turnaround is taking longer than expected, early gains, like a 20% jump in the running category, suggest the strategy is working, according to the CEO.

Zacks Investment Research analyst David Bartosiak told Reuters that high-profile corporate partnerships alone are not the "silver bullet" to drive a turnaround, adding they lack "meaningful innovation."

Benzinga's Edge Rankings place Nike in the 28th percentile for quality and the 65th percentile for value, reflecting its mixed performance. Benzinga's screener allows you to compare Nike's performance with its peers.

NKE Price Action: On a year-to-date basis, Nike declined 30.47%, as per Benzinga Pro. On Thursday, it climbed 2.02% to close at $44.