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Simone Biles Leaves Nike for Gap’s Surging Athleta Brand

Gap Inc.’s Athleta division has soared over the past year as Americans embraced loungewear during the pandemic. Now, the athleisure line is gaining credibility as a performance brand, too.

Athleta on Friday announced a long-term partnership with highly decorated Olympic gymnast Simone Biles to create a line of products for “aspiring athletes,” specifically girls. With the agreement, Biles ended her affiliation with athleticwear behemoth Nike Inc. in favor of the lesser-known brand.

“I admire Athleta for their commitment to recognize and support women’s individual and collective strength,” Biles said in a statement announcing the deal. “Together, I believe we can help girls to confidently and passionately take on the world in their athletic endeavors and beyond.”

The tie-up is Athleta’s biggest step yet to establish itself as a brand for athletes, alongside Nike or yogawear titan Lululemon Athletica Inc. The Gap unit had previously dipped its toe into the sponsorship world with an agreement in 2019 to bring another formerly Nike-affiliated athlete, Olympic track star Allyson Felix, into its ranks as a brand ambassador.

Gap’s shares rose 1.4% as of 10:12 a.m. in New York. Shares of Nike, which is losing Biles just days after a deal with the estate of former basketball great Kobe Bryant ended, were little changed.

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Felix, like Biles, has been outspoken about the rights of female athletes. In May 2019, while she was in negotiations to renew her contract with Nike, Felix penned an Op-Ed in the New York Times about her sponsor’s refusal to guarantee she wouldn’t be punished financially if she didn’t perform at her best in the months after giving birth. She signed with Athleta a few months after the Op-Ed and unveiled a line of clothing last year.

But Biles signing onto Athleta is another level. The 24-year-old is one of the best-known athletes in the U.S., and the biggest star in a sport set to enter the global spotlight again with this summer’s Olympics.

Mary Beth Laughton, chief executive officer of Athleta, said in the statement that the brand is dedicated to “championing the next generation of female athletes.” This partnership also follows strategic moves by Athleta to expand its sizing offerings.

In the most recent quarter, net sales at Athleta rose 29%, according to Gap. At the same time, net sales at the namesake brand were down 19%.

Gap has been public about making Athleta a bigger part of its overall strategy. The San Francisco-based company has said it wants Athleta and Old Navy to account for 70% of the company’s sales by 2023. In March, it said Athleta’s annual sales growth was 16%, and the brand surpassed $1 billion in sales in fiscal 2020.

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