Nike CEO Elliott Hill firmly dismissed speculation regarding the potential sale of Converse during the company’s third quarter earnings call on Tuesday. He stated, “Converse is a valued member of the Nike, Inc. family, and we are excited about its long-term prospects.”

Converse Revenue Decline

Despite Hill’s confidence, Converse experienced a significant revenue drop in the third quarter. Revenues totaled $264 million, a 35 percent decrease compared to the $405 million reported during the same period last year. This decline was observed across all territories.

Turnaround Efforts Underway

Hill acknowledged that the turnaround for Converse “is not finished,” but emphasized the clear direction of the ongoing efforts. He highlighted that the Converse team has taken “decisive steps” this quarter to restore the brand to a healthy business position. Further details regarding these turnaround efforts are expected to be shared during the company’s investor day this fall, with the exact date yet to be announced.

Analyst Speculation and Restructuring

The CEO’s comments followed research notes from BNP Paribas Equity Research senior analyst Laurent Vasilescu, who suggested Nike might be preparing to divest Converse. Vasilescu pointed to a section in Nike’s 8-K filing concerning “Costs Associated With Exit or Disposal Activities” as a potential indicator.

Vasilescu also referenced Nike’s 2024 restructuring plan aimed at saving $2 billion by fiscal year 2026. He noted that despite this plan, selling, general, and administrative (SG&A) expenses have remained flat. Earlier analysis in January highlighted a precarious underlying health for Converse, citing revenue declines of 28 percent in the first quarter and 31 percent in the second quarter.

Financial Performance Overview

Overall, Nike’s fiscal year 2026 sales fell 35 percent to $520 million from $794 million in the prior year. Diluted earnings per share decreased to 35 cents from 54 cents. Net sales for the period reached $11.3 billion, remaining flat on a reported basis but down 3 percent on a currency-neutral basis.

Concluding the earnings call, Hill expressed confidence in Nike’s progress, stating, “I am confident that our progress in the areas we prioritize…point to where we are ultimately heading across our portfolio.” He acknowledged that progress across the entire portfolio would not be immediate due to the scale and breadth of Nike’s operations.