Nike may be exploring a major shift in its brand portfolio as analysts suggest the iconic sneaker maker could sell Converse, the casual footwear label it has owned since 2003. Recent performance data and internal strategy discussions point to Converse’s faltering financial health as a potential catalyst for divestiture — a notable move in a period of strategic refocusing for the sportswear giant.
Converse’s Slipping Sales and Brand Challenges
According to a recent client note from BNP Paribas Equity Research, Converse’s revenue declined 30% in its most recent quarter, contrasting with Nike’s own growth. The research firm also flagged a striking 44% drop in demand creation year‑over‑year, a key indicator of consumer interest and marketing effectiveness. This steep decline — far deeper than earlier in the year — suggests the brand’s momentum may be lagging broader market expectations.
Beyond the sales slump, Converse’s profit margins have deteriorated significantly, with substantial basis‑point contractions reported across consecutive quarters. Analysts note that lower average selling prices and higher production costs may reflect an increased reliance on discounting and off‑price channels, rather than strong wholesale performance — conditions that could weaken the brand’s long‑term positioning within Nike’s portfolio.
Strategic Alternatives Under Review
Nike has declined to comment publicly on the possibility of selling Converse, but industry observers see the situation as part of a broader reassessment of brand assets. Nike’s history of divestitures — including past sales of Cole Haan, Umbro and Hurley — underscores that shedding underperforming or noncore units can be part of tightening the company’s strategic focus.
Converse remains a globally recognized lifestyle brand, historically adding depth and cultural cache to Nike’s overall portfolio. Its iconic Chuck Taylor All‑Star and other classic models have long driven cultural relevance, even as performance and trend dynamics shift in the highly competitive footwear market.
As Nike continues to streamline operations and prioritize performance‑driven segments — from athletic wear to digital services — the fate of Converse will be closely watched by investors and brand strategists alike. A sale could reshape a key chapter in both companies’ histories and signal a deeper transformation in how major apparel players manage legacy lifestyle assets.
