Nike is cutting 775 jobs across its U.S. distribution operations, making this the latest move in CEO Elliott Hill's $2 billion restructuring plan. The layoffs, announced January 26, 2026, will primarily affect distribution center roles in Tennessee and Mississippi, where Nike operates large warehouse facilities. This move is Nike's third major workforce reduction in two years aiming to restore profitability and declining sales.
Nike's sales trends over the past two years have been well below normal, creating severe overcapacity in its distribution infrastructure. According to Morningstar analyst David Swarz, "Nike's sales trends over the past two years have been well below normal, so it's highly likely that it overbuilt warehouse capacity and overstaffed. Coupled with the rapidly increasing capabilities of AI, the cuts were not surprising."
Nike's revenue declined 10% year over year during the period preceding Hill's appointment in October 2024, with full-year fiscal 2024 revenue growing just 1%. The company has lost market share to specialized competitors like Hoka and On, which have captured momentum in the performance running category, a segment that once defined Nike's competitive dominance. Excess distribution capacity became a drag on margins at precisely the moment when Nike could least afford operational inefficiency.
