Nike Announces 1,400 Layoffs as Part of Turnaround Strategy

Nike announced a new round of layoffs on Thursday impacting approximately 1,400 roles across the organization, mostly concentrated in its technology department. In a note from COO Venkatesh Alagirisamy, the company said the layoffs were part of Nike's broader "Win Now" turnaround strategy aiming to reshape its technology team, modernize its air manufacturing, move some of its Converse Footwear operations and integrate its materials supply chain work into its footwear and apparel supply chain teams. "Collectively, these changes will result in a reduction of approximately 1,400 roles in global operations, with the majority in technology," Alagirisamy wrote. "These reductions are very hard for the teammates directly affected and for the teams around them, too." A Nike spokesperson said the layoffs are about better positioning the organization for the current pace of sports and accelerating its growth. The layoffs affect employees across North America, Asia and Europe and represent less than 2% of the company's total global headcount. "This is not a new direction," Alagirisamy wrote. "It is the next phase of the work already underway." Impacted employees will be notified beginning Thursday, Nike added. CEO Elliott Hill has been working to turn around Nike after years of slumping sales. While Hill has made some initial progress, it's come with some bumps in the road. Nike previously announced 775 job cuts in January, primarily at its U.S.-based distribution centers, due to the company's work in accelerating its use of automation. At the time, the company said the cuts are part of Nike's goal to return to "long-term, profitable growth." Those layoffs came on top of a round of cuts last summer that affected less than 1% of Nike's corporate staff as part of the company's efforts to realign the business. In its third fiscal quarter earnings report last month, the retailer warned that sales will continue to fall for the rest of the year, primarily led by an anticipated 20% decline in China during the current quarter.