Nike revealed on Thursday that it will lay off approximately 1,400 employees, with the majority of the cuts concentrated in its technology department, as part of its ongoing 'Win Now' turnaround strategy [1]. According to a note from COO Venkatesh Alagirisamy, these layoffs are intended to reshape Nike's technology team, modernize Air manufacturing, move some Converse Footwear operations, and integrate materials supply chain work into its broader footwear and apparel supply chain teams [1]. The layoffs will impact employees across North America, Asia, and Europe, representing less than 2% of Nike's total global workforce [1].
A Nike spokesperson stated that the layoffs are aimed at better positioning the company for the current pace of sports and to accelerate growth [1]. CEO Elliott Hill has been leading efforts to turn the company around after years of declining sales, with some initial progress but ongoing challenges [1]. This is the second round of layoffs this year, following 775 job cuts in January, primarily at U.S.-based distribution centers, which were attributed to increased automation [1]. Additionally, there were job cuts last summer affecting less than 1% of corporate staff as part of business realignment efforts [1].
In its third fiscal quarter earnings report last month, Nike warned that sales are expected to continue declining for the remainder of the year, with a projected 20% drop in China during the current quarter [1]. The company emphasized that the current layoffs are not a new direction but the next phase of ongoing restructuring efforts [1].
CONCLUSION
Nike's announcement of 1,400 layoffs, primarily in technology, marks a significant step in its ongoing restructuring under the 'Win Now' strategy. With continued sales declines and a challenging outlook, the company is taking decisive actions to streamline operations and position itself for future growth.