One of the companies affected is Topsports International Holdings, which is Nike’s largest distributor in mainland China. Sales of Nike products through Topsports’ online platforms accounted for approximately 22 percent of the distributor’s total revenue during the fiscal year ended in February. The announcement that the online agreement is being terminated caused Topsports’ share price to fall by over 20 percent on the Hong Kong Stock Exchange during Wednesday’s trading. However, cooperation regarding physical stores will continue.
Topsports CEO Yu Wu commented on the change in a press release, emphasizing that the relationship with the sporting giant continues in the physical channels. He stated that this adjustment will put some short-term pressure on their operations, but they are firmly convinced that this direction in the medium and long term will help promote a healthier, more orderly and sustainable retail system in China, while further improving the customer experience and the appeal of the products.
The decision comes at a time when Nike has experienced declining revenues in the Chinese market. During the fiscal year 2026, revenues in the region fell by 11 percent, marking the eighth consecutive quarter of decline. At the same time, competitor Adidas reported a revenue increase in China of 13 percent in 2025, followed by growth also in the fourth quarter.
"Reduce Fragmentation"
Cathy Sparks, newly appointed Vice President and General Manager of Nike in China, states in a letter that the new digital strategy is designed to simplify things for the consumer. She wrote that the new flagship stores will function as a single destination for Nike within these ecosystems, with clearer product presentation, stronger storytelling and more cohesive customer journeys. She added that it is about strengthening the platforms where consumers already start and complete their shopping journey, and ensuring that these experiences are direct, consistent and unequivocally Nike. According to Sparks, the strategy is not about reducing availability, but about reducing fragmentation and strengthening the customer journey.
However, some financial market analysts are skeptical as to whether a restructuring of sales channels is sufficient to reverse the trend. Analysts draw parallels to Nike’s previous decision-making in North America, where reduced wholesale sales led to lost market share.