Nike Cuts 775 U.S. Jobs to Accelerate Automation and Increase Profit

Nike is laying off 775 U.S. employees as part of its strategy to enhance profits and accelerate automation. This decision aims to streamline operations and significantly impacts distribution center roles in Tennessee and Mississippi, where the company has large warehouses. The layoffs, reported first by CNBC, come as Nike faces challenges in regaining its position as a leading sportswear brand after losing market share to competitors.

Nike’s Ongoing Restructuring Efforts

The decision to cut jobs is part of Nike’s broader turnaround initiative. In August, the company reduced less than 1% of its corporate workforce. These job cuts were executed under the leadership of CEO Elliott Hill, who took charge in 2024. Earlier this year, Nike announced plans to eliminate 2% of its workforce—totaling over 1,600 positions—in February 2024.

Reasons Behind the Job Cuts

• Boosting profits and efficiency through automation.
• Downsizing to address overstaffed operations.
• Aiming to streamline distribution operations in the U.S.

Nike’s recent sales trends have fallen below expectations, prompting concerns that the company may have overbuilt its warehouse capacity. Analyst David Swarz from Morningstar indicated that ongoing advancements in artificial intelligence also make these job cuts logical.

Current Workforce and Future Plans

As of May 2025, Nike employed approximately 77,800 people globally, including retail and part-time staff. Under CEO Hill, the company is heavily investing in sneaker lines, focusing on core sports like running and soccer. Despite efforts to improve profitability, Nike reported a drop in gross margins for the second consecutive quarter, affected by poor sales in China and challenges in product mix adjustment.

Moreover, the company has faced additional setbacks, including a recent data breach that exposed corporate information. Nike reaffirmed its commitment to reducing operational complexity and enhancing flexibility through these layoffs. This approach is crucial for supporting its goal of long-term profitable growth.