Nike campus in India: a bet for growth as sales in China fall

Nike made a big bet on India.

The retailer, which is struggling to revive its business and regain momentum under CEO Elliott Hill, is hoping the world’s most populous country can help it turn the page on its performance.

While reporting its first quarter results on October 1, the company announced that it would establish a new global campus in Bangalore, India, as part of its growth strategy. Hill wrote in a letter to employees that the new facility would be a “long-term investment” in helping Nike succeed.

“India is already an important growth market and manufacturing hub for Nike, with strong capabilities and access to talent,” Hill wrote.

The new campus is expected to open in the coming years and expand to businesses roles within the organization, including namesake brand Nike, Jordan Brand and Converse. Nike plans to discuss its India campus in detail at its investor day next month.

In a statement to CNBC, a Nike spokesperson said expanding into India was a “natural” next step for the company as it looks to increase its global presence.

“As participation in running, basketball, football, fitness and other sports continues to grow across India, we see an opportunity to better serve athletes through strengthened local capabilities, consumer insights and innovation,” the spokesperson said.

India will be the world’s third largest retail market by 2030, according to Indian conglomerate Reliance Industries. Its e-commerce market was valued at $159.25 billion in 2026 and is expected to reach $332.94 billion by 2031, according to IBEF, a business advocacy organization established by the Indian government.

Nike has endured a crisis for years and is trying to turn around its business as part of Hill’s turnaround plan. Nike also announced this month that it would lay off employees across the company as part of what it dubbed its Pace strategy, which includes supply chain changes and a reorganization of the company’s geographic segments. Nike awaits the effort achieve approximately $2.5 billion in savings through fiscal year 2031.

Nike’s decision to invest more in India as part of its comeback comes as the sportswear company loses revenue in another critical international market: China. Although first-quarter revenue in North America was slightly above Wall Street expectations, Hill said the performance was not enough to offset pressures overseas.

Nike has been particularly struggling in the Greater China market, where its revenue fell 26% during its fiscal first quarter. Experts say it’s part of a broader trend of U.S. companies losing relevance and appeal to national brands as the once-lucrative market matures.

On a call with analysts earlier this month, Hill said the company was taking “deliberate steps” to strengthen its China business, although he said those effects would take time to materialize. Hill said the company plans to refresh its physical retail business, launch a digital cleanse and create higher-quality experiences for consumers.

Nike’s spokesperson told CNBC that the company is “deeply committed” to China and sees the region as one of its “most important long-term growth markets,” even as Nike expands its presence in India.

“China remains a long-term priority for Nike, while India represents another important opportunity to invest in the future of sport and the next generation of athletes,” the spokesperson said.

The company’s expansion into India could come at an opportune or inopportune time, experts say. Investing in a growing international market does not guarantee increased sales. It also requires persuading Indian consumers that they want the Nike brand, a challenge the company has struggled to overcome in China.

“What Nike, I think, is doing right now is going region by region and working to reestablish what the brand stands for,” Simeon Siegel, senior managing director at Guggenheim Securities, told CNBC.

Siegel said part of the dissonance for Nike is that each region and segment of the company is at a different stage in its turnaround. He said investing in India could define the The company is preparing for a more sustainable future if its China business continues to lag, but Nike must have a compelling product, strong storytelling and extensive distribution in the region to succeed there.

“I think the company needs to look inward and figure out what is the right way to get back to profitability,” he said. “And that involves, in some cases, shrinking and saving and reducing, and, in some cases, investing and looking to the future, because the goal here is not to fade into oblivion; it’s to shrink to stability and then ultimately growth.”

The global strategy may also focus too much on a long-term vision rather than more immediate solutions, according to Jessica Ramirez, co-founder and chief executive of retail and apparel consultancy The Consumer Collective. Ramirez said she already thought Nike and Hill’s vision was “disconnected” and that the plan for the Indian campus hadn’t necessarily helped her case.

“I don’t know if this plan from India is currently an immediate solution to their problems,” she said. “They have to plan for the long term, right? But they also have to plan for the short term, which keeps collapsing.”

She said Nike had not shared concrete enough plans to regain momentum in China and needed to develop the two regions hand in hand.

While Nike under Hill has improved its wholesale and performance categories, Ramirez said it still needs to master its direct-to-consumer and sportswear segments, which would allow the company to thrive in all of its markets.

Nike’s spokesperson told CNBC that the retailer is committed to investing in both countries in an attempt to expand its global presence.

“It is important to note that this is not a decision between India and China,” the spokesperson said. “We always invest market by market based on long-term opportunities to serve athletes and grow sports around the world.”

However, India presents an attractive opportunity for many companies looking to generate growth overseas.

Ramirez said Nike is just the latest to join a cohort of U.S. companies looking to establish their presence in the market. While many brands began investing in China years ago, she said that trend is now heading to India as U.S. companies see more spending pressures in the Chinese market and deal with geopolitical tensions between the two countries.

“It’s about committing for the long term and making sure they’re there when they can reap the positive effects,” she said. “I want to say that this conversation has started to become a little more engaging over the last two or three years as companies have started to invest more in India.”

India is one of the world’s best-performing markets, driven primarily by domestic demand, investment and supply chain diversification, according to an Accenture analysis. With a population of more than a billion, the country presents a growth opportunity similar to that offered by China in the early 2000s.

“It’s going to be a rapidly growing consumer base that we assume will continue to have their income levels rise and have a lot more spending power, and then maybe we could tap into that market from a consumer perspective,” Chris Tomsovic, who leads Accenture’s macro foresight team, told CNBC.

Nonetheless, a key focus of the Indian consumer is price sensitivity, which will pose a challenge for US companies trying to enter the market, he added. Even so, many national brands in the market are younger, meaning there may now be more opportunities for Western companies to take market share.

Another challenge is that The Chinese consumer has always been receptive to American brands, but it will take even more data to understand what Indian shoppers think of these companies, he said. For sportswear retailers, a focus on the most popular sports in each region will also factor into this equation.

“Can they really locate the product, make the price work? Can they adapt to the local social media technology ecosystem? Can they adapt to the local cultural values ​​and norms desired by the consumer? » said Tomsovic.

“If you can figure that out, then I think you’re right. Whether you’re a footwear brand or an athleisure brand, I think there’s a huge opportunity there with a billion consumers,” he said.