Nike Cuts 775 Jobs in Automation Shift at Distribution Centers

Nike is set to reduce its workforce by nearly 800 jobs as part of a significant automation initiative at its distribution centers. This move is aimed at enhancing operational efficiency within the footwear and apparel giant.

The company will eliminate 775 positions, primarily affecting employees at its distribution centers located in Tennessee and Mississippi. This decision aligns with Nike’s strategy to automate more aspects of its supply chain. The news was initially reported by CNBC, citing sources familiar with the situation.

A Nike spokesperson stated, “To power our Win Now actions, we’re taking steps to strengthen and streamline our operations so we can move faster, operate with greater discipline, and better serve athletes and consumers.” The company is focused on refining its supply chain footprint, accelerating the adoption of advanced technology and automation, and investing in the skills necessary for future growth.

NIKE ANNOUNCES CAITLIN CLARK AS ITS NEWEST SIGNATURE ATHLETE

Nike is planning to cut jobs at distribution centers in Tennessee and Mississippi. (David Paul Morris/Bloomberg via Getty Images)

“These actions are designed to reduce complexity, improve flexibility, and build a more responsive, resilient, responsible, and efficient operation to support our path back to long-term, profitable growth, including contributing to improved EBIT margins over time,” Nike added.

The distribution center layoffs in the South follow similar restructuring efforts by Nike over the past two years, aimed at enhancing the company’s operational efficiency and financial performance.

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In August of last year, Nike announced plans to cut less than 1% of its corporate workforce as part of a broader strategy to revitalize its business under the leadership of CEO Elliott Hill.

Earlier, the company had revealed intentions to reduce its workforce by 2%, equating to over 1,600 employees, in February 2024.

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Nike is restructuring aspects of its business to regain its edge in footwear and sportswear. (istock)

Under Hill’s leadership, Nike has been focusing on its running shoe and sneaker lines to reclaim market share lost to competitors. The company reported a decline in gross margins for the second consecutive quarter in December, largely due to poor sales in China and ongoing challenges in adjusting its product mix.

As of the latest trading session, Nike’s stock closed at $64.99 per share, reflecting a 2% increase year-to-date.

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Reuters contributed to this report.

Nike is set to reduce its workforce by nearly 800 jobs as part of a significant automation initiative at its distribution centers. This move is aimed at enhancing operational efficiency within the footwear and apparel giant.

The company will eliminate 775 positions, primarily affecting employees at its distribution centers located in Tennessee and Mississippi. This decision aligns with Nike’s strategy to automate more aspects of its supply chain. The news was initially reported by CNBC, citing sources familiar with the situation.

A Nike spokesperson stated, “To power our Win Now actions, we’re taking steps to strengthen and streamline our operations so we can move faster, operate with greater discipline, and better serve athletes and consumers.” The company is focused on refining its supply chain footprint, accelerating the adoption of advanced technology and automation, and investing in the skills necessary for future growth.

NIKE ANNOUNCES CAITLIN CLARK AS ITS NEWEST SIGNATURE ATHLETE

Nike is planning to cut jobs at distribution centers in Tennessee and Mississippi. (David Paul Morris/Bloomberg via Getty Images)

“These actions are designed to reduce complexity, improve flexibility, and build a more responsive, resilient, responsible, and efficient operation to support our path back to long-term, profitable growth, including contributing to improved EBIT margins over time,” Nike added.

The distribution center layoffs in the South follow similar restructuring efforts by Nike over the past two years, aimed at enhancing the company’s operational efficiency and financial performance.

NIKE RETURNS TO SELL FOOTWEAR, APPAREL ON AMAZON FOR THE FIRST TIME SINCE 2019

In August of last year, Nike announced plans to cut less than 1% of its corporate workforce as part of a broader strategy to revitalize its business under the leadership of CEO Elliott Hill.

Earlier, the company had revealed intentions to reduce its workforce by 2%, equating to over 1,600 employees, in February 2024.

KIM KARDASHIAN PARTNERS WITH NIKE ON NEW SKIMS BRAND

Nike is restructuring aspects of its business to regain its edge in footwear and sportswear. (istock)

Under Hill’s leadership, Nike has been focusing on its running shoe and sneaker lines to reclaim market share lost to competitors. The company reported a decline in gross margins for the second consecutive quarter in December, largely due to poor sales in China and ongoing challenges in adjusting its product mix.

As of the latest trading session, Nike’s stock closed at $64.99 per share, reflecting a 2% increase year-to-date.

GET FOX BUSINESS ON THE GO BY CLICKING HERE

Reuters contributed to this report.