By Neil J. Kanat and Nicholas P. Brown
Jan 26 (Reuters) – Nike will lay off 775 employees, a person familiar with the matter told Reuters on Monday, as the sportswear giant looks to boost profits and accelerate its use of automation.
The person said the layoffs will primarily affect distribution centers in Tennessee and Mississippi, where the sneaker giant operates large warehouses.
Struggling Nike is trying to re-establish itself as the world’s leading sportswear brand after losing market share to rivals. The company has gone through multiple rounds of layoffs in recent years.
In August, the company laid off less than 1% of its corporate workforce as part of a turnaround effort under Chief Executive Officer Elliott Hill, who takes over the top job in 2024.
The company had previously announced it would lay off 2% of its workforce in February 2024, totaling more than 1,600 people.
CNBC first reported Monday’s layoffs.
Nike said in a statement to Reuters that it was “taking steps to strengthen and streamline our operations so that we can move faster (and) operate with greater rigor.”
The company said the move will primarily affect its distribution business in the United States.
Morningstar analyst David Swarz said: “Nike’s sales trends over the past two years have been well below normal, so it is likely that there is excess warehouse capacity and overstaffing.” Coupled with the rapid increase in artificial intelligence capabilities, he said the layoffs are “not surprising.”
As of the time of its last annual report in May 2025, Nike had 77,800 employees worldwide, including retail and part-time employees.
Under Hill, the company has been investing heavily in its sneaker line as it attempts to refocus the brand on core sports such as running and soccer.
Nike reported its second straight quarterly decline in gross profit margin in December as weak sales in China and efforts to restructure its product mix continue to plague the company.
The company also recently suffered a data breach in which hackers exposed a large amount of company data.
Nike said in a statement on Monday that the cuts “are designed to reduce complexity, increase flexibility and … support our return to a path to long-term profitable growth.”
(Reporting by Neil J Kanatt in Bengaluru and Nicholas Brown in New York; Editing by Pooja Desai)
