Challenges in consumer demand for sports footwear and apparel could mean a long recovery time for brands in China.
There are indications that shoppers are becoming more discerning about where and how they spend, though running has been a bright spot.
“Running remained relatively more resilient than other categories, although growth also decelerated” in the third quarter of fiscal ’26, Jefferies analyst Randal J. Konik noted. He also wrote that the “weakness appears broad-based across brands and categories rather than isolated to a few laggards.” Consumers are becoming increasingly selective, and compounding the overall sales picture is that China sportswear demand remained weak in September and early October, with consumption downgrade trends intensifying.
Of course, this isn’t a surprise, given the disclosures about Nike’s troubles in China. The apparel and shoe giant is making plans to rejigger its China operations, including a new Asia-Pacific plan to move the Greater China out of China to Singapore. And earlier this month, Nike debuted a new line locally designed for the China market by its recently formed Local Production Creation Team.
For now, a continued delay in the recovery of confidence among the Chinese mass-market base fuels ongoing challenges already faced by the sporting goods category, impacting brands such as Anta Sports — the third-largest sportswear firm in China behind Nike and Adidas — and Nike.
Anta is the Finnish group Amer Sports‘ largest shareholder, and it recently completed its acquisition of a stake in Puma, becoming the German brand’s largest stakeholder. The general consensus is that Anta could help Puma return to growth mode, particularly in the Chinese market and because of Anta’s strong track record in turning around global brands that include Fila, Kolon Sport and Amer, according to an HSBC report.
In Konik’s report, he said that the current “backdrop is least supportive of On Running as premium running is slowing just as competition rises and new stores become less productive, which leaves little room for a premium-priced share gainer.” He added that while discounting at On “remains relatively disciplined,” share gains are harder to achieve as competition intensifies.
“Amer Sports is better insulated, as Salomon keeps taking share and Arc’teryx’s premium positioning holds through a China normalization,” the Jefferies analyst said. And while Arc’teryx anchors premium, “Salomon is the growth engine.”
For Nike, the critical proof point remains full-price demand, and its elevated markdown activity continues to pressure the broader market. Those levels are hurting full-price sell-through at Anta Sports and Li Ning, and keeping retailers from replenishing.
Looking ahead, Konik concluded: “Retailers remain cautious and highly selective on orders, while we see rising risks to Winter full-price selling given soft traffic trends and weaker-than-expected Golden Week demand.” That doesn’t mean Konik is negative on Nike. He’s bullish on the overall global turnaround, but is “realistic on China.”
“China is a lagging piece of the Nike story,” Konik said. “Cleaner inventory and normalized orders may help reported growth, but a durable recovery needs better product, stronger full-price demand and evidence that share losses are moderating.”
Adidas, by contrast, did see acceleration in the third quarter on broad franchise strength that include its Climacool sneakers — they feature breathable mesh uppers that fit like a sock — and apparel, as well as its localization strategy and value proposition, according to the Jefferies research. Konik isn’t the only one who saw Adidas as a possible outlier in the China market.
Adidas held an Innovation Day last month, showcasing its local-for-local market approach, where 90 percent of the sourcing is done locally. It’s a move that could be the key to unlocking growth potential.
HSBC global sporting goods analyst Anne-Laure Bismuth said after Innovation Day that the Adidas localization efforts “have paid off,” particularly in China where it continues to be a strong growth engine for the brand. What she likes about the local market approach is that it provides agility, flexibility and brand awareness, with the regional team responsible for giving consumers a localized version of the Adidas brand, while staying true to its roots. The U.S. version would see Adidas localizing through athletes and teams.