As we reported earlier, corporate giant Nike slashed Converse’s marketing budget by 44 percent, directly contradicting CEO Elliott Hill’s promises of a turnaround.
READ MORE: Corporate Skate Shoe Giant Nike Cuts Converse Marketing 44% Despite CEO’s Turnaround Promise
This huge cut has fueled speculation among analysts that Nike could be seriously considering selling the struggling brand.
Despite ongoing struggles at Converse, Nike president and chief executive officer Elliott Hill said during the company’s third quarter earnings call on Tuesday that selling the brand is not on the table.
Analysts had been speculating about a potential deal for Converse, but Hill dismissed those rumors, emphasizing that the brand will remain part of the Nike family.
“Converse will remain an important part of the Nike, Inc. family, and we are excited about its long-term prospects,” Hill said during the call. He added that while there is still work to do, the path forward is clear, with teams focused on strengthening the brand’s foundation.
Hill also noted some of the actions taken by the Converse team in recent months, including restructuring efforts earlier this year that led to layoffs.
While the company did not disclose the exact number of employees affected, these were described as decisive steps to improve the health of the business.
The financial numbers show the challenges the brand is facing. Third quarter revenues for Converse came in at $264 million, down from $405 million during the same period last year, a drop of 35 percent. The company noted that declines were seen across all regions.
Nike said it will share more details about its plans for Converse at its upcoming investor day later this fall, though the exact date has not yet been announced.