Nike Plans More Job Cuts as Sales Forecast Slumps Amid $2.5B Restructuring

Nike has told staff that more jobs will go under a restructuring programme designed to save about $2.5B (£1.89B) through fiscal 2031, as it forecasts that annual sales will fall by a high-single-digit percentage.

Chief executive Elliott Hill, who returned to run Nike in October 2024, set out the plan, named Pace, in a note to employees on 1 October, the day Nike reported first-quarter results. 'This work will result in fewer roles across Nike,' he wrote.

Hill did not say how many jobs will go or where, telling staff that any figures in media reports are speculative. Decisions about affected roles will begin in calendar year 2027.

Nike had about 73,000 employees on 31 May, down from 77,800 a year earlier, according to its annual reports. Some 10,600 work at its headquarters campus near Beaverton, Oregon.

Pace follows two earlier rounds of cuts at Nike this year. In January, Nike said it would eliminate about 775 jobs, mostly at distribution centres in Tennessee and Mississippi, as it expanded automation. In April, it announced about 1,400 more, mostly in technology.

What Pace Will Cost

Nike's board has approved steps expected to bring about $1.0B (£757M) in pre-tax charges through fiscal 2031, mainly employee-related costs, a filing with the US Securities and Exchange Commission shows. That is on top of roughly $300M (£227M) in severance recognised in fiscal 2026 under a cost plan announced in March, which Pace absorbs.

Chief financial officer Dave Denton, who joined from Pfizer in August, said most of the savings should arrive in fiscal 2029 and 2030. Nike cautioned that its estimates could change materially.

Hill told employees Pace is not a response to a single quarter, and said on the earnings call that Nike will add capabilities in some areas and remove duplication in others.

Beaverton Roles to Move as Nike Opens Bengaluru Campus

Nike now runs four regions: North America; Europe, the Middle East, and Africa (EMEA); Greater China; and Asia Pacific and Latin America. Under Pace, North America and Latin America will form an Americas unit, and Asia Pacific will join Greater China as APGC.

APGC's leadership will be based in Singapore, and some roles supporting the region from Beaverton will move closer to those markets. Teams are due to move into the new structure in fiscal 2028.

A new campus in Bengaluru will house full-time staff supporting Nike, Jordan Brand, and Converse. Hill described India as an important growth market and manufacturing hub for Nike.

Why Nike Expects Sales to Fall Again

The forecast covers the year to 31 May 2027. Revenue in fiscal 2026 was $46.4B (£35.12B), flat on the year before. Nike expects adjusted earnings of $1.15 to $1.35 (87p to £1.02) a share, excluding Pace costs.

Denton told analysts the decline reflects deliberate supply cuts in Nike Sportswear, Jordan Brand, and Greater China, with pressure running into fiscal 2028. In the results release, he said first-quarter performance was 'consistent with our expectations, supported by improved gross margin and disciplined cost management.'

Sportswear, just under half of quarterly revenue, fell by a low-double-digit percentage after Nike cut Dunk trainer revenue by nearly 50%, a planned hit of about $200M (£151M). Jordan Brand dropped by a mid-teens percentage as retro releases were scaled back.

In China, Nike is withdrawing from heavily discounted online channels. Growth in performance lines such as running and football is not yet enough to offset those declines, Hill said.

Every Region but North America Shrinks

Revenue for the three months to 31 August fell 4% to $11.2B (£8.48B), and net income slipped 2% to $712M (£539M).

North America grew 2% to $5.13B (£3.88B). EMEA fell 5% to $3.18B (£2.41B), Asia Pacific and Latin America slipped 2% to $1.46B (£1.11B), and Greater China dropped 22% to $1.18B (£893M), or 26% excluding currency movements.

Shares Drop 7.1% in After-Hours Trading

Nike shares closed at $35.15 (£26.61) on Thursday and fell 7.1% after hours. In comments carried by AFP, Neil Saunders, managing director of GlobalData, said the results show 'Nike's brand heat continues to fade.'

Nike will set out more detail on Pace and its long-term financial targets at an investor day on 16 and 17 November.