Nike Axes Headcount To Save Cost, Cuts Over 1,600 Jobs: Report
Portfolio Pulse from Lekha Gupta
Nike Inc (NYSE:NKE) announced plans to cut approximately 2% of its global workforce, over 1,600 jobs, to reduce costs. The layoffs, which will not affect store and distribution center employees or the innovation team, aim to reallocate resources towards key areas such as running, women's apparel, and the Jordan brand. Despite these cuts, Nike faces challenges, including a slight revenue miss in Q2 FY23 and anticipates up to $2 billion in cost savings over the next three years amidst rising macro headwinds.
February 16, 2024 | 11:49 am
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Nike plans to cut over 1,600 jobs to save costs and reallocate resources towards key growth areas. The company faces revenue challenges and aims for significant cost savings amidst macroeconomic headwinds.
The job cuts and strategic reallocation of resources by Nike indicate a significant restructuring aimed at cost savings and focusing on growth areas. While this could lead to short-term financial strain and investor concern, the long-term focus on key categories and cost savings could potentially offset these challenges. The immediate market reaction might be neutral to slightly negative due to the uncertainty surrounding the impact of these layoffs and cost-saving measures on future performance.
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