HKG:3813

Nike Ends Online Distribution Deals With China's Topsports, Pou Sheng

Chinese sportswear retailers faced a sharp selloff on Wednesday after Nike announced plans to overhaul its digital footprint in China, effective January 2027, terminating online sales partnerships for companies including Topsports International (HKG:6110) and Pou Sheng International (HKG:3813).Topsports and Pou Sheng received official notice from Nike that online sales of its products in mainland China will "terminate completely" starting in 2027, according to separate Hong Kong bourse filings on Wednesday.Near the close of the session, Topsports' stock plunged 24% to an all-time low, while Pou Sheng fell almost 9%, also trading near its lowest on record.Nike products accounted for about 22% of Topsports' revenue in the fiscal year ended Feb. 28, with the company saying it expects a "significant" negative impact, albeit short-term. Topsports also said it will continue working with Nike on offline sales arrangements.Pou Sheng, meanwhile, said Nike made up 15% of total revenue for 2025, with an "insignificant" contribution to group profit.Under Nike's revised plan, the sportswear maker will exclusively sell its products on its official Tmall, JD.com (HKG:9618) and Douyin storefronts."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," Cathy Sparks, Nike's vice president and general manager for Greater China, said in a statement.Jefferies analysts noted that while the move strengthens Nike's direct-to-consumer ecosystem and pricing discipline, the transition will create short-term headwinds for wholesale business volumes across China.