Nike has announced layoffs of 1,700 workers in a cost-cutting move.

According to a report from CNN, Nike has joined the growing list of companies that are making the difficult decision to lay off employees. This news comes from an email sent by Nike's President and CEO, John Donahoe, on February 16. In the email, Donahoe announced that 2% of the company's workforce, which is equivalent to 1,700 employees, will be let go in an effort to reduce costs by $2 billion. At the time of the announcement, Nike had over 83,000 employees worldwide, but due to a slowdown in sales in December 2023, the company had to take this action.
Donahoe sent a lengthy email to all Nike employees, informing them of the upcoming job cuts which are set to begin tomorrow. The decision to lay off employees was previously mentioned during Nike's last earnings call in December. The announcement was accompanied by a tweet from Brendan Dunne, a reporter for CNN, on February 16, 2024.
This decision to cut costs comes after Nike experienced a decrease in revenue and concerns grew about consumers reducing their spending. In order to make up for the loss in profits, Nike is planning to save $2 billion over the next three years. A spokesperson for the company stated that these measures will help Nike focus on their biggest opportunities for growth. However, they also acknowledged that this decision will affect around 2% of their employees and expressed gratitude for the contributions made by all of their team members.
Aside from facing tough competition from other popular sneaker brands like Hoka and On Cloud, Nike is also having to adapt to changes in consumer behavior. It seems that customers are shifting their spending towards more essential items and experiences, such as travel, rather than expensive sneakers and athletic wear. In response to these changes, retailers have also been adapting by incorporating technology and digital offerings in their physical stores to enhance the shopping experience and reduce friction.
Nike has taken notice of these changes and according to their finance chief, Matt Friend, their new approach reflects the more cautious consumer behavior seen across the world, including in Europe and China. As reported by KGW8, Donahoe stated that the first round of job cuts will be completed by the third week of February 2024, with a second round following by the end of May. While the majority of the layoffs will occur at the company's headquarters in Beaverton, Donahoe assured that store employees and distribution center workers will not be affected. He also acknowledged that this is a difficult reality for all involved and took responsibility for the company's current performance.
Donahoe also expressed confidence in Nike's future, stating that the company has a history of rising up during challenging times. He believes that the team will come together once again to overcome this obstacle. In related news, a collection of Nikes worn by Michael Jordan was recently sold for $8 million at an auction.

[This article has been trending online recently and has been generated with AI. Your feed is customized.]