Sports giant in trouble, plans to cut jobs

Nike, one of the world’s largest and most recognizable manufacturers of sportswear and footwear, has announced job cuts. The decision was made in response to a negative financial forecast for the fourth quarter.

In a conversation with Reuters, a Nike representative revealed that the company has decided to lay off some employees responsible for technological areas . The exact number is not known. In parallel, some duties are to be entrusted to external suppliers, which suggests a gradual transition to a more flexible operating model. This is a response to the expected declines in revenue.

Nike logo on a building / Unsplash, Wu Yi

In March, Nike said it expected a bigger drop in fiscal fourth-quarter revenue than analysts had expected, a forecast that sent Nike shares down nearly 5%.

It is worth mentioning that Q3 was also not kind to the sports giant. The brand recorded a 9% drop in revenue to $11.27 billion and a 30% drop in earnings per share. Despite the successful launches of the Pegasus Pro and Vomero 18 sneakers, investors were concerned about the results in China - sales there fell by as much as 17%.

CFO Matthew Friend stressed that the coming quarter will be difficult due to the sale of older products and the need to rebuild relationships with retailers.

New CEO Elliott Hill unveiled a "Win Now" turnaround plan to expand product offerings and intensify operations in five key cities: Shanghai , Beijing , Los Angeles , New York and London .

Layoffs in the technology department are not just about cutting costs – they are also a signal that the company wants to manage its resources more effectively and adapt its operating model to the challenges of the modern market.