Nike Plans Job Cuts, Global Operations Overhaul Amid Weak Sales Outlook

Nike is planning another round of layoffs as the sportswear giant overhauls its operations following a sharp decline in sales in China and issues a weaker-than-expected revenue outlook for the year.

On Thursday, the company announced a restructuring program called “Pace,” which will consolidate Nike’s four geographic divisions into three, modernize its supply chain, establish a new corporate campus in India, and further streamline its workforce.

Nike did not say how many jobs would be eliminated or where most of the reductions would occur. CEO Elliott Hill told employees that decisions on affected positions would begin in calendar year 2027 and continue beyond then.

“This work will result in fewer roles across Nike, and I want to acknowledge that news like this creates uncertainty,” Hill said in a company-wide message. “I don’t take that lightly.”

The planned reductions would extend several rounds of workforce cuts as Nike tries to revive sales and simplify its operations. In April, the company said it would eliminate about 1,400 jobs, largely in operations and technology, following the elimination of about 775 distribution-center positions in January.

Under Pace, Nike will combine North America and Latin America into an Americas division and merge Asia Pacific with Greater China. Europe, the Middle East, and Africa will remain in the same category called EMEA.

Nike also plans to build a new campus in Bengaluru, India, to support Nike, Jordan Brand, and its global operations.

The restructuring is expected to generate about $2.5 billion in cumulative savings through fiscal year 2031. Nike expects roughly $1 billion in pretax restructuring charges over that period, in addition to about $300 million in severance costs recorded in fiscal 2026.

The announcement came as Nike reported a mixed first quarter of fiscal 2027, which ended Aug. 31.

Revenue fell 4 percent to $11.21 billion, while net income declined 2 percent to $712 million. Gross margin improved by 60 basis points to 42.8 percent, mainly because of lower warehousing and logistics costs.

Greater China remained a major drag on results. Sales in the region fell 22 percent from the previous year to $1.18 billion, with wholesale revenue down 28 percent.

On a currency-neutral basis, total Greater China sales dropped 26 percent, marking the ninth consecutive quarterly decline in the market.

North America was the only one of Nike’s four geographic regions to post a year-over-year revenue growth, although the increase was modest at 2 percent.

Nike’s direct business also remained under pressure. Nike Direct revenue fell 8 percent, including a 13 percent decline in digital sales and a 5 percent drop at company-owned stores.

Nike now expects fiscal 2027 revenue to decline by a high single-digit percentage.

On an earnings call Thursday, Hill said Nike would revoke online selling rights from several major retail partners in China beginning in January 2027, as part of the effort to steer more customers toward Nike-controlled digital channels and branded stores.

“We are eliminating distribution through channels that are not aligned with our marketplace strategy, which will decrease the deep discounting of our brands,” Hill said.

“In the near term, revenues and profitability in China will be impacted,” he told investors and analysts, adding that the company’s effort to clean up its digital marketplace would take multiple seasons.

In addition to the China overhaul, Hill identified Jordan Brand as another area in need of improvement.

Jordan accounted for about 13 percent of Nike’s global business in the first quarter of fiscal 2027, while revenue for the brand fell by a mid-teens percentage, Hill said.

“Simply put, we’ve been oversupplying our iconic retro product, asking them to do too much,” he said during the call.

Nike’s response will be to deliberately reduce the volume and frequency of certain Jordan retro releases, returning to what Hill described as a “scarcity model.”

“When consumers see the Jumpman, it should feel special. It should feel earned,” Hill said.