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Nike plans to cut jobs with digital push


(Reuters) – Nike Inc (NKE.N) warned of job cuts on Friday as the world’s largest shoe maker steps up efforts to sell directly to customers through its online and retail channels.

The planned layoffs come after the company on Thursday announced a quarterly net loss of $ 790 million, its first for more than two years, as its wholesale business suffered the bulk of shoe and department store farmers in because of the coronavirus epidemic.

Friday, Dow component stocks fell 6%.

“We are shifting resources and creating reinvestment capacity in our areas of greatest potential, and we anticipate that our realignment will likely result in a net loss of jobs,” Nike said in an email statement.

“The cuts are not made to cut costs. All the savings will be reinvested in our priorities, “said the shoe maker.

CEO John Donahoe told analysts on Thursday that the company would now aim for digital to account for 50% of its overall business, up from 30% in the quarter.

“Our vision is to create a clear and connected digital market … So we are accelerating our approach,” he said.

Donahoe, former CEO of ServiceNow and executive director of eBay (EBAY.O), joined Nike earlier this year as the company strengthened its direct-to-consumer sales activities.

According to the media company Complex, Donahoe, in a letter to employees, said that the company “does not yet know how many jobs will be cut, nor who will be specifically affected.” (bit.ly/31lsziW)

https://s1.reutersmedia.net/resources/r/?m=02&d=20200626&t=2&i=1523763377&w=1200&r=LYNXMPEG5P1IA

Source: Reuters

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