Nike plans to remove 775 positions from its U.S. distribution operations in a bid to lift profitability and speed the adoption of automation, sources familiar with the matter told news outlets. The workforce reductions are expected to fall mainly on roles at large distribution centers located in Tennessee and Mississippi.
The announcement follows a series of earlier workforce actions at the sportswear company. In August of last year, Nike said it would reduce less than 1% of its corporate headcount as part of efforts to reposition the business under CEO Elliott Hill. Prior to that, the company disclosed a separate reduction that represented approximately 2% of jobs - more than 1,600 positions - announced in February 2024.
Under Hill's leadership, Nike has been directing investment toward its running shoes and sneaker ranges with the aim of regaining market share in those categories. At the same time, the company has faced margin compression: Nike reported a decrease in gross margins for a second successive quarter in December as weak sales in China and a deliberate reset of its product mix weighed on results.
Nike did not immediately respond to a request for comment.
Context and operational focus
The staffing reductions announced for distribution centers are part of a broader push to integrate more automation into Nike's logistics and fulfillment operations. The company operates sizeable warehouse facilities in Tennessee and Mississippi, and the current cuts are concentrated among distribution-center roles rather than corporate functions.
The earlier workforce reductions referenced by the company - the sub-1% corporate cut in August and the roughly 2% reduction announced in February 2024 that totaled over 1,600 jobs - reflect an ongoing effort to tighten costs while reshaping product and marketing priorities under executive leadership.
Financial and market signals
Nike's sequential gross margin declines through December and persistent softness in China underscore the financial pressures prompting operational changes. The company has framed investments in core footwear categories, notably running shoes and fashionable sneaker lines, as central to its recovery strategy.
Observers of the retail, logistics and consumer apparel sectors will likely view the distribution center layoffs and accompanying automation push as indicative of broader cost-management and efficiency priorities at a major apparel manufacturer.