Nike will lay off workers as part of $2-billion cost-cutting plan

2024-12-24 08:51:37 source: category:Stocks

Nike plans cost-cutting measures to save up to $2 billion over the next three years, including layoffs and more automation.

The company also slashed its annual sales forecast to only 1%. This sent its own stock price down, along with shares of rivals Adidas, Puma and Lululemon.

The sportswear giant partly blamed slumping online sales, particularly in the key market of Greater China. which includes Hong Kong, Taiwan and Macau. Chief Financial Officer Matt Friend reported store sales in the region grew 16%, though Nike Digital sales fell 22% in the quarter that ended November 30.

"We are seeing indications of more cautious consumer behavior around the world," Friend told analysts on Thursday.

He did not specify the scale of job cuts or other changes needed to achieve the $2-billion cost-cutting plan, but said the restructuring will include "reducing management layers" as well as "simplifying our product assortment."

"We know in an environment like this, when the consumer is under pressure and the promotional activity is higher, it's newness and it's innovation which causes the consumer to act," Friend said.

Bank of America analyst Lorraine Hutchinson said in a note that the impact is likely to hit in the 2025 fiscal year, with areas for growth in women's and running products as well as the Jordan brand.

More:Stocks

Recommend

Arbitrator upholds 5-year bans of Bad Bunny baseball agency leaders, cuts agent penalty to 3 years

NEW YORK (AP) — An arbitrator upheld five-year suspensions of the chief executives of Bad Bunny’s sp

Memorial Day weekend 2024 could be busiest for travel in nearly 20 years

This year is expected to be one of the busiest travel years in nearly two decades, with about 43.8 m

Zayn Malik Shares Rare Insight Into Relationship With Ex-Fiancée Perrie Edwards

Zayn Malik is giving a shoutout to his ex.Nearly a decade after his split from Little Mix's Perrie E