Nike to cut 775 jobs as automation accelerates at US distribution centres

Nike is set to cut 775 jobs, largely across its US distribution centres, as the world’s largest sportswear maker accelerates the use of automation in its supply chain to improve efficiency and profitability.

The job cuts will primarily affect warehouse operations in Tennessee and Mississippi, where Nike runs major distribution facilities, people familiar with the matter told CNBC. The reductions add to the roughly 1,000 corporate roles the company eliminated last summer.

In a statement to CNBC, Nike said the layoffs are focused on its US distribution operations and are part of a broader effort to simplify its business and strengthen long-term performance.

“We’re taking steps to strengthen and streamline our operations so we can move faster, operate with greater discipline, and better serve athletes and consumers,” the company said. Nike added that it is sharpening its supply chain footprint, accelerating the adoption of advanced technology and automation, and investing in skills needed for the future.

Nike did not disclose how many people it employs across its US distribution network, nor did it specify the scale or timing of further automation at individual sites.

The cuts come as companies across logistics and retail increasingly turn to automation to lower costs and lift margins. Last year, UPS said it planned to eliminate around 48,000 roles, citing efficiency gains from greater automation at its facilities.

At Nike, the restructuring is taking place as chief executive Elliott Hill works to turn around the business after several years of slowing sales and margin pressure. The challenges followed a strategy under former CEO John Donahoe that prioritised direct-to-consumer sales through Nike’s own stores and digital channels, reducing reliance on wholesale partners.

That shift drove a sharp expansion in Nike’s distribution footprint and staffing levels, but volumes have since fallen short of what those operations were built to handle, people familiar with the matter told CNBC.

Since taking over, Hill has moved to rebuild relationships with wholesale partners, clear excess inventory and refocus on product innovation. When reporting results for the fiscal second quarter in December, Nike said net income fell 32%, reflecting higher costs tied to the turnaround, tariff pressures and weaker demand in China.

Nike said the latest job cuts are aimed at supporting a return to “long-term, profitable growth” by improving flexibility and resilience across its supply chain. As automation advances and the turnaround unfolds, further changes to how the company staffs and runs its distribution operations are likely to follow.