Nike Layoffs: Sportswear Giant Announces More Job Cuts and Restructuring Amid Slumping China Sales
Nike is deepening its restructuring and planning new job cuts starting in 2027 after a steep sales decline in China and a weak full-year revenue outlook. As part of its restructuring program, Nike will streamline its global operating model into three geographic divisions. While the exact number of job cuts remains undetermined, Nike confirmed that employee notifications will begin in 2027.
Sportswear giant Nike has announced a sweeping overhaul of its global business divisions and further workforce reductions after issuing a surprisingly steep full-year revenue forecast that heightened investor concerns over its ongoing turnaround. The tepid guidance underscores persistent headwinds under Chief Executive Officer Elliott Hill, particularly in Greater China, where quarterly sales plunged 26 per cent on a constant-currency basis. The broader slump has intensified scrutiny on the pace of the company's strategic recovery.
Strategy and Operational Overhaul
As part of its restructuring program, Nike will streamline its global operating model into three geographic divisions - Americas, Asia Pacific and Greater China, and EMEA - down from four, reports Reuters. The company also plans to open a new corporate campus in India equipped with strong operational capabilities and local talent access. BMW Layoffs: Why the Automaker Is Cutting 20% of Senior Management Roles Using AI.
While the exact number of job cuts remains undetermined, Nike confirmed that employee notifications will begin in 2027. This restructuring initiative is projected to yield approximately USD 2.5 billion in cost savings through fiscal 2031, with the majority realised across fiscal years 2029 and 2030. "Our Nike performance business is not yet large enough to offset the pressure we're seeing in Nike sportswear, Jordan brand, and Greater China," Hill said on a post-earnings call, noting that reviving these segments "will take time".
Pressures in China and Core Product Lines
Greater China - historically a major profit driver - has experienced nine consecutive quarters of declining sales, with the downward trend accelerating recently. The region accounts for roughly 15 per cent of Nike's annual revenue as the company faces fierce competition from both international rivals and domestic sportswear brands. In addition to regional struggles, Hill pointed to missteps in product strategy, specifically an over-reliance on lifestyle items and an oversupply of iconic Jordan retro releases. Nike intends to curb the volume and frequency of retro launches to re-establish product scarcity and brand appeal. Citigroup Layoffs: Bank Cuts Jobs in Risk and Compliance Teams Amid Automation Push, Says Report.
Financial Performance and Outlook
For the first quarter ended August 31, Nike reported a 4 per cent decline in total sales to USD 11.21 billion, missing average analyst estimates. However, gross margins improved by 60 basis points to 42.8 per cent, aided by reduced warehousing and logistics expenses. Looking ahead, Nike anticipates a high single-digit revenue decline for fiscal 2027, contrasting with more modest analyst projections. Management plans to provide further details regarding its long-term targets during upcoming investor updates in November.
(The above story first appeared on LatestLY on Oct 03, 2026 06:07 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).
