Nike CEO Makes a Commitment to Converse Fans Amid Declining Sales

The struggling brand is still an important part of Nike’s portfolio.

BY MOSES JEANFRANCOIS, NEWS WRITER @MOSESJEANS

Illustration: Inc; Photo: Converse, Nike

Chuck is here to stay. Despite declining sales from Converse, Nike president and chief executive officer Elliott Hill is shutting down rumors that he is selling the iconic footwear brand. 

On the company’s third-quarter earnings call on Tuesday, Hill noted that the Converse team took some “decisive steps” this quarter to bring the brand back to a healthy business, which included layoffs at the brand in February. 

Revenues for Converse in the third quarter were $264 million, down 35 percent on a reported basis from $405 million at the same time last year. 

“This quarter we took meaningful actions to improve the health and quality of our business. The pace of progress is different across the portfolio and the areas we prioritized first continue to drive momentum,” said Hill in a release. 

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In a March note (via RetailDive), BNP Paribas Equity Research senior analyst Laurent Vasilescu speculated that Nike could be exiting the Converse business. “Could this be the exit or disposal of Converse we flagged in our January 10Q note? We believe it could be,” he wrote. 

Vasilescu pointed to recent challenges at the brand, including a 28 percent revenue decline in the first quarter, followed by another 31 percent drop in the second. 

“Converse will remain an important part of the Nike, Inc. family, and we are excited about its long-term prospects,” Hill said on the earnings call. “Overall, the work is not finished, but the direction is clear. Our teams are moving with focus and urgency, and our foundation is getting even stronger.” 

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