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Nike announces workforce reductions amid broader restructuring plans

Nike announces workforce reductions amid broader restructuring plans

Sportswear powerhouse Nike is taking steps to streamline its operations by implementing staff reductions, aiming to cut approximately two percent of its current workforce.

The Beaverton, Oregon-based company is reportedly set to lay off more than 1,600 employees as part of a broader restructuring effort.

Nike has articulated its intention to reallocate capital towards its growth areas, including running, women’s apparel and its iconic Jordan brand.

CEO John Donahoe emphasised this shift in a memo obtained by CNBC, stating, ‘This is how we will reignite our growth. This is a painful reality and not one that I take lightly. We are not currently performing at our best, and I ultimately hold myself and my leadership team accountable.’

The layoffs will be carried out in two phases, with the first round scheduled for this week and the second expected to be completed by the end of Nike’s fiscal fourth quarter this year. While specific departments affected by the layoffs have not been disclosed, reports indicate that retail employees at Nike stores and warehouse workers will not be impacted. Workforce reductions in the Europe, Middle East and Africa (EMEA) regions will follow a different timeline to comply with local labour laws.

As part of its cost-cutting measures, Nike plans to simplify its product assortment and increase automation and technology utilisation. The company aims to optimise its operations to drive efficiency and enhance its competitive edge in the sportswear market.

In addition to internal restructuring efforts, Nike is reportedly gearing up for a bidding war with rivals Puma and Adidas for the rights to become the next official kit and equipment supplier of the French Football Federation (FFF). Nike currently holds these rights, with the contract set to expire in 2026. The anticipated bidding process shows Nike’s commitment to maintaining its presence in the global soccer market despite recent shifts in partnerships and sponsorships.

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