Nike Announces New Round of Layoffs

As part of CEO Elliott Hill's efforts to realign the company and return it to growth, Nike is preparing to lay off another round of employees. Less than 1% of Nike's corporate employees will be affected by the cuts. How many jobs will be affected is unknown. Converse's and Nike's EMEA businesses won't be affected.

“As we shared in Q4 earnings, NIKE, Inc. is in the midst of a realignment. The moves we’re making are about setting ourselves up to win and create the next great chapter for NIKE,” the company told CNBC in a statement. 

 “This new formation is built to put sport and sport culture back at the center, to connect more deeply with the athlete and the consumer, and to give us the space to create what only NIKE can.”

As part of a larger restructuring, Nike announced last February that it would lay off over 1,500 jobs, or 2% of its workforce. Hill's efforts to alter the organization of teams within the company include the most recent round of layoffs. Nike restructured its business divisions under former CEO John Donahoe. As part of a larger attempt to expand its lifestyle business, it was separated into women's, men's, and children's categories rather than by sport.

According to some critics, Nike's innovation pipeline collapsed as a result of this adjustment, as the company shifted its focus from athletes to lifestyle products that catered to a broad spectrum of consumers. In order to shift the company's focus to sports and culture, Hill, a longtime Nike veteran, is currently undoing that work. The company stated that leaders were chosen in July to lead the new teams after Hill presented his vision in June, and that a "small number" of employees would leave due to the changes.

Nike informed employees in a memo that some employees would be joining a new team, reporting to a new manager, or taking on a new role or level as part of the changes. By September 8, staff members will be informed if they are affected during conversations. Most of the new positions will start on September 21.

“To make space for these conversations, corporate employees based in an office location in the U.S. and Canada will work remotely next week, unless otherwise informed by your leader,” the memo said.

Following a lower-than-expected decline in first-quarter revenue, the company announced in June that it would reduce its reliance on Chinese production for the U.S. market in order to lessen the impact of import tariffs.

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