Sportswear giant Nike announced on Thursday a reduction in its workforce by 2% that will result in the layoff of more than 1,500 jobs as part of its comprehensive restructuring initiative.
Nike Cuts Workforce by 2%
According to CNBC, Nike CEO John Donahoe cited the company's intention to allocate more funds towards its growth segments, such as running and women's products and the Jordan brand, to reinvigorate its growth trajectory.
Acknowledging the significance of the decision, Donahoe described it as a necessary step to address the current performance challenges faced by the company, holding himself and his leadership team accountable for the situation.
The layoffs will occur in two phases, with the first round commencing immediately and the second phase scheduled to conclude by the end of Nike's fiscal fourth quarter, typically in May.
However, adjustments in the company's EMEA (Europe, the Middle East, and Africa) region will be on a different timeline based on local labor regulations.
Will the Nike Layoffs Affect Retail Workers?
While the specific departments affected by the layoffs remain unspecified, Nike assured that these measures will not impact retail employees in its stores and warehouse workers.
The decision comes amid a backdrop of evolving consumer spending patterns, with the retail sector bracing for a potential downturn in demand for discretionary items like apparel and footwear, constituting a significant portion of Nike's business.
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