Nike begins layoffs, shakes up leadership

Oregon’s largest company said Wednesday that it is beginning layoffs announced last month as Nike shakes up its leadership and realigns its strategy under newly installed CEO John Donahoe.

“While we (aren’t) providing numbers, the changes are expected to lead to a net loss of jobs, which is always difficult,” Nike said in a written statement. “We’re focused on shifting resources and creating capacity to reinvest in our highest potential growth areas.”

Nike said it will spend between $200 million and $250 million on termination costs associated with the cutbacks, which suggests the scale of the job losses will be substantial.

Nike employed 77,000 at the time of its most recent annual report, which is now nearly a year old. An updated tally is imminent.

The company said previously its pending layoffs are associated with the new strategy, not disappointing sales the company reported last month, and indicated the job cuts will continue at least into the fall.

Nike’s shares were little changed in morning trading Wednesday at $98.45, near an all-time high. While the coronavirus pandemic has depressed the company’s sales, investors consider Nike among the businesses best-positioned to ride out the downturn.

Nike calls its new strategy “Consumer Direct Acceleration.” It is focused on online sales, directly to customers. That could reduce the company’s reliance on less-profitable sales through physical retailers, including struggling department stores and footwear specialists inside malls.

Nike said last month it is realigning to focus on just three product categories – men’s, women’s and kids. The company named three current executives to run the segments: Amy Montagne will run the men’s group, Whitney Malkiel heads the women’s category and McCallester Dowers runs the kids segment.

They will report to Michael Spillane, president of “consumer creation,” while Heidi O’Neill will oversee Nike’s geographic segments as president of “consumer and marketplace.”

Additionally, Nike promoted Jordan Brand President Craig Williams and Converse CEO G. Scott Uzzell to Nike’s executive board.

— Mike Rogoway | mrogoway@oregonian.com | twitter: @rogoway | 503-294-7699

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