Nike Will Cut 1,750 Jobs Worldwide, Including 500 At Oregon HQs
Nike Thursday announced plans to "lay off 1,750 employees worldwide, including 500" at its Beaverton, Oregon, HQs, according to Mike Rogoway of the Portland OREGONIAN. Nike has been "planning a massive restructuring since February," but Thursday's "cutbacks -- 5[%] of the company's global work force -- are even larger than Nike had forecast last winter." Nike Dir of Corporate Communications Erin Dobson said the cutbacks are "about realigning the business for the future." But Susquehanna Financial Group analyst Christopher Svezia said that Nike's business "remains strong." Svezia said that Nike "expects the restructuring to save the company about" $225M. Nike "hasn't said what it plans to do with the savings," but Svezia said that the company "may try to expand in fast-growing countries such as China or experiment with new retail strategies." Dobson said that severance packages "will be robust," and at a minimum, employees "will receive two months of pay and certain benefits." Additional benefits "will depend on length of service." Nike's share price rose $1.43 on Thursday, closing at $50.95 before the company announced its job cuts (Portland OREGONIAN, 5/15). In London, Peter Stiff reports the job cuts "represent the largest headcount reduction in the company’s history." Nike President & CEO Mark Parker said, “We remain a growth company and we know these changes have created a stronger organisation that will enable us to invest in our most significant opportunities” (LONDON TIMES, 5/15). At presstime, Nike shares were trading at $51.00 up 0.05% from Thursday's close (THE DAILY).
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