Nike Announces It's Leaving the Golf Equipment Business

And adidas is selling off its brands, including TaylorMade

A Nike Golf display featuring Tiger Woods and his victory at the 2008 U.S. Open is shown at a Nike factory store
Nike Golf's fortunes were always tied to Tiger Woods. The company will continue making footwear and apparel, but not golf equipment, it announced in August 2016. Getty Images

Aug. 4, 2016 - A bombshell development in the world of golf equipment: Nike Golf is getting out of the business. Not selling off its equipment brands, but simply leaving the market.

No more Nike Golf drivers, irons, wedges, putters, woods, hybrids or golf balls. Or golf bags.

As an aside, you have to love how companies spin things in their press releases. Here's the topper from Nike's brief, official announcement:

"Nike, Inc. announced today that it will accelerate innovation in its Golf footwear and apparel business and will partner with more of the world’s best golfers. With this new focus, Nike Golf will transition out of equipment — including clubs, balls and bags."

Talk about burying the lead.

So Nike will keep making golf shoes and golf apparel, but stop making golf balls and golf clubs.

Nike Golf's fortunes have always been tied to Tiger Woods. Nike first made golf products (footwear) in 1984. When Nike signed Woods in 1996 (for the biggest golf endorsement deal ever to the point, $40 million), it didn't even make golf clubs or golf balls. It essentially created a golf division specifically for Woods.

Woods began playing a Nike Golf ball (the Tour Accuracy TW) in 2000, and had one of the greatest seasons in golf history that year. The company's first set of golf clubs to reach the retail market only appeared in 2002.

(Woods also made a series of iconic TV commercials for Nike Golf, perhaps most famously the ball-bouncing, or juggling, ads.)

But as Woods' domination declined, and then injuries forced him away from competition, so, too, have Nike Golf's sales declined. In the past fiscal year, Nike Golf's sales dropped by 8-percent, and Nike Golf was the worst-performing division within the larger company, Nike Inc.

Nike Golf, even at its peak, always trailed far behind industry sales leaders TaylorMade and Callaway.

Nike Golf's Tour Players Become Free Agents

Tour golfers signed to endorsement deals with Nike Golf are now auditioning new clubs - and looking for new endorsement deals.

Woods and Rory McIlroy are two of the biggest names in golf, both Top 5 in star power, and will have to seek out new deals. Woods' agent, Mark Steinberg, told Golf.com, "The plan is continued rest and rehabilitation and we'll sort out the equipment thing in due course. I'll be in the process of doing that, effective immediately."

McIlroy tweeted, "Sad for @nikegolf employees that worked so hard and made genuinely great golf equipment. Your support will always be appreciated #TeamNike"

Another huge name on the Nike Golf roster - despite her lackluster 2015 and terrible 2016 - is Michelle Wie. Her star power is dimmed, but still present, and other equipment companies will be making runs at signing her.

Nike Golf's exit probably catches a lot of people by surprise, not just employees. The company was still signing golfers earlier this year, inking Brooks Koepka and Tony Finau to deals in January.

Other prominent names on the Nike Golf tour staff include Charl Schwartzel, Russell Henley, Nick Watney, Kevin Chappell, Paul Casey, Thorbjorn Olesen, Suzann Pettersen and Cheyenne Woods.

When Do Nike Clubs and Balls Disappear?

Nike Golf's announcement only stated the company was "transitioning" out of the business. No specific dates or timetable were provided for when the the company's golf equipment will stop appearing in shops.

And Adidas Is Searching for a Buyer for Its Golf Brands

Meanwhile, the German giant adidas is also looking to get out of the golf equipment business - but not by shutting down its brands, but selling them off.

Adidas announced nearly a year ago it was considering selling its TaylorMade, Adams Golf and Ashworth brands. It has been actively shopping those brands around to potential buyers for more than a month now.

TaylorMade is one of the biggest names in golf - it will survive just fine. Ashworth is a niche brand - golf apparel - and so might survive, too.

Adams Golf is a wildcard. I expect the Adams brand to find a buyer, too, and Adams golf clubs to remain on the market, but in this age of consolidation it's difficult to be completely confident about smaller equipment brands.

Adidas has owned TaylorMade Golf since 1997, Ashworth since 2008 and Adams Golf since 2012.