For several quarters now, China challenges have been a drag on Nike‘s earnings during its overall turnaround. Now the Swoosh is taking action to right the ship in the region.
On Tuesday, Nike’s new vice president and general manager of Greater China, Cathy Sparks, laid out the company’s plans for China in a letter, calling the actions a “focused and reimagined” marketplace in the region.
Beginning in January 2027, Sparks noted that Nike’s digital marketplace in China will be anchored by official Nike flagship experiences on Tmall, JD.com and Douyin, alongside Nike.com.cn and the Nike App.
“These new flagships will serve as the single, elevated destination for Nike within these ecosystems, with clearer product presentation, stronger storytelling and more connected consumer journeys,” Sparks wrote in Tuesday’s letter.
“As part of this change, with some exceptions across licensee partners, partner-operated online storefronts will transition out of selling Nike product,” Sparks added. “This is not about reducing access. It is about reducing fragmentation and strengthening the consumer journey. When the experience is consistent, the brand becomes stronger.”
In a statement sent to FN, a Nike representative reiterated that the company’s new actions in China are “not a pullback” nor a “retreat” from digital commerce or wholesale.
The spokesperson explained that Nike has 16 store partners who own and manage thousands of Nike stores across China, and there are currently more than 1,000 digital storefronts on China’s digital marketplace platforms.
“Many of these marketplaces are run by Nike store partners and many of whom are using their brick-and-mortar doors to fulfill these digital orders,” the representative noted. “Not all of the 1000-plus storefronts are operated by our 16 partners, but a big portion are — along with sub-retailers. All these digital storefronts have created an overly complex and fragmented consumer experience.”
So, the solution to this complexity comes in four actions. In addition to consolidating the digital marketplace, Nike will also work to launch new branded digital storefronts on partner platforms and major digital marketplaces.
The Swoosh said it would continue to operate across major digital marketplaces where Chinese consumers discover and shop, including platforms such as Tmall, JD.com, Douyin and others. As part of this, Nike will also launch new premium digital flagships across all of these major digital marketplaces in China.
Next, the company will continue to invest in brick-and-mortar retail with its 16 Nike store partners. This also includes investing in the company’s owned Nike retail doors, like its House of Innovation store in Shanghai, which posted double-digit growth last quarter. For context, Nike has more than 200 owned stores in the Greater China region.
Nike Greater China’s first partner-operated ACG door in Nanjing, managed by Topsports, is Nike’s largest distributor in Greater China.
Courtesy of Nike
Nike is also committing to more localized product. In Tuesday’s letter, Sparks noted that the company hired its first vice president of local product creation for Greater China and expect the first product from that team to be sold this holiday season.
But overall, Nike’s new China strategy means that, for the most part with a few exceptions, its 16 retail partners, who operate thousands of Nike branded brick-and-mortar doors now, will no longer sell Nike products online as of Jan. 1, 2027. Instead, Nike will partner with them to focus primarily on “elevating” the brick-and-mortar experience.
Initial reactions from analysts on the move were mixed. In a new research note on Wednesday, BNP Paribas Equity Research senior analyst Laurent Vasilescu called Nike’s new actions in China a “strategic misstep.”
“We are curious to know how Nike will sell excess inventory in China going forward as it terminates [digital] wholesale for [Nike China distributors] Topsports and Pou Sheng,” Vasilescu wrote. “This official decision reminds us of when Nike decided to exit certain North American wholesale partners, and it then ceded market share to competitors. We think the same will happen with the Topsports and Pou Sheng official news.”
On the other hand, Jonathan Komp, senior research analyst at Baird, called the move “a positive step toward restoring marketplace control and higher quality sales.”
“Commentary points to headwinds continuing through fiscal 2027, but we see the move as necessary to return the market to healthy, full-price selling alongside efforts to make the brand more culturally relevant and sport/innovation rooted,” Komp wrote in a Wednesday research note.
In June, Nike reported that net income in the fourth quarter of fiscal 2026 was up 407 percent to $1.1 billion from $211 million at the same time last year. Diluted earnings per share in Q4 is 72 cents, this is up from 14 cents a share in the fourth quarter of 2025.
Net sales in the quarter tallied $10.97 billion, down 1 percent from $11.09 billion in the fourth quarter last year on a reported basis, and down 4 percent on a currency-neutral basis.
The company said at the time that Nike brand’s fourth-quarter revenues were $10.7 billion, flat on a reported basis and down 3 percent on a currency-neutral basis, primarily due to declines in Greater China and EMEA, partially offset by growth in North America.
