Nike cuts nearly 1,700 jobs

(CNN) — Nike will lay off about 2% of its workforce, or about 1,700 people, as the sportswear giant looks to save up to $2 billion in costs.

“The actions we are taking position us to right-size our organization to take advantage of our greatest growth opportunities,” a Nike spokesperson said in a statement Friday. “Although these changes will impact approximately 2% of our total workforce, we are grateful for the contributions made by all Nike associates.”

According to its latest annual report, as of May 31, 2023, the company employed about 83,700 people worldwide.

In December, Nike cut its revenue forecast and announced cost cuts amid growing concerns that consumers around the world are slowing their spending. The company said it wants to save up to $2 billion over the next three years.

Consumers are changing their behavior, moving away from discretionary purchases of goods (like expensive sneakers and sportswear) toward basic goods and experiences like concerts and trips.

Nike also faces stiff competition from emerging brands like Hoka and On Cloud.

Reporting the latest financial results in December, Nike CFO Matt Friend said its disappointing outlook reflected “signs of more cautious consumer behavior around the world” and also cited “increasing macroeconomic headwinds in China and Europe.” .

China, the world’s second-largest economy, is facing huge challenges ranging from pessimistic consumers to a slowdown in the real estate sector and weak exports.

Meanwhile, Europe narrowly avoided recession in the final three months of 2023, with its economy stabilising, official data confirmed on Wednesday. And Germany, the region’s largest economy, contracted for the first time since the start of the COVID-19 pandemic last year.

Nathaniel Mayerson contributed to this article.