50 years ago, when few American companies were thinking about China, Phil Knight, the founder

of Nike, saw an opportunity.

He had this vision, and the vision was called 1 billion people, 2 billion feet.

So he understood very early on that this was a huge market.

That's our colleague John Emont, who covers Asia. He says that Knight's vision turned out to be prophetic.

How big of a success was China for Nike?

An extraordinary success. I mean mean just this awesome cash cow.

They had a very strong quarter,

mainly driven by strength in China and emerging markets.

Shares of Nike reached an all-time high on Friday.

And Nike continues to shine,

beating bottom and top line,

punctuated by 22% revenue growth this quarter.

And the company became a model for Western businesses looking to break into China.

But now, what's happening to Nike in China is looking more like a cautionary tale.

Like many American brands, Nike is now struggling there, and it's dragging down the whole company.

This quarter, Nike is projecting a 20% decline in revenue in the region.

The last four years have seen, you know, really significant deterioration in the brand.

Sales have been dropping, you know, fairly precipitously, China is definitely its biggest challenge right now.

But if it can't figure it out China,

there's a reasonable question.

We'll be able to figure out everywhere else.

...