"Nike to cut about 2% jobs to lower costs as demand weakens", 16 February 2024

Nike will cut about 2% of its total workforce, or more than 1,600 jobs, the sportswear giant said...to lower expenses as demand for its shoes and sneakers comes under pressure.

Higher rental and interest rates have led customers to cut back spending on high-priced goods, resulting in sportswear companies such as Nike and Adidas...warning that retailers are lowering their orders through wholesale channels.

Nike had in December outlined a $2 billion savings plan over the next three years, which included tightening the supply of some products and reducing management layers.

The cost cuts would include about $400 million to $450 million in employee severance costs in third quarter, it had said. Nike had about 83,700 employees as of May 31, 2023.

The job cuts are Nike getting out in front of the fear that demand "could soften still further", said GlobalData managing director Neil Saunders...

"Nike also wants to invest more in areas like running so it can gain market share, to do that it needs to balance the additional expenses with some reductions elsewhere," Saunders said...

The layoffs are not expected to impact employees in stores and distribution centers or those in its innovation team, the report said...