Nike begins implementing a plan to reduce 2% of its workforce

Nike plans to reduce its workforce by about 2%, or more than 1,600 employees, as it looks to reduce costs after recording weak profits last year.

The first phase of employee layoffs is expected to begin today, Friday, with the second phase occurring by the end of the current quarter, where the layoffs will affect employees in stores and distribution centers, as well as employees in innovation teams.

Companies operating in the same sector, such as Adidas and Puma, warned of weak profits this year, as consumers reduce their unnecessary spending.

In December 2023, Nike announced a $2 billion savings plan over the next three years, including tightening the supply of some products, improving supply chains, reducing administrative layers and increasing the use of automation.

It also announced that it will bear additional costs ranging from $400 million to $450 million related to the Unemployment Compensation Fund in the third quarter, while the company has about 83.7 thousand employees.