Nike layoffs loom as its stock price hits punishing new lows

Shares of Nike Inc. are plummeting to record lows on Friday following disappointing first quarter results and plans to reduce its workforce. The athletic company reported revenue of $11.21 billion, falling 4% year-over-year, which did not meet Wall Street's expectations of $11.32 billion, according to CNBC. Nike exceeded predictions for earnings per share, reporting 48 cents compared to the estimated 43 cents.

As of the latest trading, Nike stock (NYSE: NKE) was down more than 8% in premarket trading, having declined over 52% over the past year. Nike's president and CEO, Elliott Hill, announced a new operating model that could lead to job cuts. He stated that decisions to implement these cuts would begin in 2027, but he is unsure of the exact number or locations of affected roles.

Hill emphasized that Nike must become more agile, efficient, and athlete-focused to succeed, which will result in fewer roles across the company. The company has already laid off around 775 U.S. employees in January alone. The new operating model also involves dividing customers into three geographic areas: Americas, APGC, and EMEA.

A new Nike campus will be established in Bengaluru, India. Additionally, the company is modernizing its supply chain, progress on which is noted as considerable by Hill. Nike's stock is currently near a 13-year low and has fallen into the bottom 10 performers for the S&P 500, with the athletic giant being removed from the S&P 100 last month.