Nike Plans to Cut 775 Jobs Amid Automation Push
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jan 27 2026
0mins
Source: Benzinga
- Job Cuts Announcement: Nike plans to eliminate 775 positions at U.S. distribution centers as part of its ongoing automation initiative, reflecting a broader restructuring trend in the retail sector that could impact operational efficiency and market competitiveness.
- Historical Layoffs: This reduction follows the disclosure of 1,000 corporate job cuts last summer, indicating that Nike is implementing aggressive cost-control measures in response to weak sales and declining margins.
- Technical Analysis: Nike's stock is currently priced at $63.66, trading 1.2% below its 20-day simple moving average and 4.6% below its 100-day simple moving average, indicating a bearish short-term trend that requires cautious investor response.
- Market Reaction: Following the announcement, Nike shares fell by 2.05%, nearing their 52-week lows, which challenges market confidence in the company's future performance, with key support at $63.00, below which further declines may occur.
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Analyst Views on NKE
Wall Street analysts forecast NKE stock price to rise
21 Analyst Rating
14 Buy
7 Hold
0 Sell
Moderate Buy
Current: 64.820
Low
62.00
Averages
76.11
High
110.00
Current: 64.820
Low
62.00
Averages
76.11
High
110.00
About NKE
NIKE, Inc. is engaged in the designing, marketing and distributing of athletic footwear, apparel, equipment and accessories and services for sports and fitness activities. The Company's operating segments include North America; Europe, Middle East & Africa (EMEA); Greater China; and Asia Pacific & Latin America (APLA). It sells a line of equipment and accessories under the NIKE Brand name, including bags, socks, sport balls, eyewear, timepieces, digital devices, bats, gloves, protective equipment and other equipment designed for sports activities. It also designs products specifically for the Jordan Brand and Converse. The Jordan Brand designs, distributes and licenses athletic and casual footwear, apparel and accessories predominantly focused on basketball performance and culture using the Jumpman trademark. The Company also designs, distributes and licenses casual sneakers, apparel and accessories under the Chuck Taylor, All Star, One Star, Star Chevron and Jack Purcell trademarks.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Hershey's Sales Growth Surprises: Hershey anticipates net sales growth of 4% to 5% in 2026, significantly exceeding analysts' expectations of 2.69%, while the CEO is pushing for innovation in healthier, zero-sugar products, which is likely to enhance market share and brand competitiveness.
- Nike's Attractive Valuation: Currently trading at a P/E of 20, Nike is well below its historical average of 31, and despite weak performance in Greater China, North America saw a 9% sales increase, with the upcoming 2026 FIFA World Cup expected to drive demand and profit growth.
- Market Rebound Potential: All three companies possess strong brand influence and market share in their respective sectors, and their current stock prices appear undervalued, presenting investors with an opportunity to capitalize on future rebounds through diversified investments.
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- Lululemon's International Growth: Lululemon's international revenue surged 33% year-over-year in Q3, with China alone up 46%, indicating that while U.S. revenue fell 3%, the international segment is becoming the main revenue driver, expected to boost future performance.
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- Disconnect Between Data and Sentiment: Despite rising economic output and stock market gains, ordinary Americans are feeling increased financial pressure, as evidenced by credit card debt reaching a record $1.28 trillion in Q4 last year, indicating that economic prosperity is not benefiting the majority.
- Uneven Inflation Impact: According to Morgan Stanley, lower-income consumers faced significantly higher inflation rates for food and housing in 2024 compared to wealthier counterparts, exacerbating the gap between economic growth and consumer confidence and highlighting social inequality.
- 'Hiring Recession' in Job Market: While economic output per hour hit new highs, ordinary workers are anxious as the job market tightens, with December job openings falling to their lowest level since 2020, reflecting the disparity in economic benefits between high-income stockholders and the general workforce.
- Crisis of Trust in Economic Data: Surveys reveal that nearly 60% of Americans believe the economy is in recession, particularly among low-income households facing unstable financial situations, leading to a decline in trust in government economic data and highlighting the significant gap between economic prosperity and public sentiment.
See More
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- Disconnection Between Growth and Sentiment: Despite the U.S. economy showing strong performance with a GDP growth rate of 4.3%, nearly 60% of Americans believe the economy is in recession, highlighting a stark contrast between economic data and the lived experiences of ordinary citizens who feel excluded from the benefits of growth.
- Uneven Inflation Impact: According to Morgan Stanley, lower-income consumers faced significantly higher inflation rates for essentials like food and housing in 2024, exacerbating economic pressures and deepening social inequality, which in turn affects consumer confidence and spending.
- Tightening Job Market: While the stock market continues to rally, job openings fell to their lowest level since 2020 in December, leading economists to describe the situation as a 'hiring recession,' which increases anxiety among lower-income individuals who feel more vulnerable in this fragile recovery.
- Declining Consumer Confidence: Recent surveys indicate that 41% of individuals with low credit scores and 54% of low-income households view their financial situations as 'unstable,' underscoring the growing gap between economic data and public sentiment, which could negatively impact future consumer spending.
See More
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- Turnaround Strategy: Nike replaced CEO John Donahoe with Elliott Hill in 2024, who is implementing the 'Win Now' strategy that leverages the brand's strength and innovation to expand sales channels through renewed wholesale agreements, aiming to drive revenue growth.
- Sales Growth Challenges: Despite an 8% increase in wholesale revenue last quarter, overall sales growth remained flat on a currency-neutral basis, highlighting the challenges Nike faces in market recovery, particularly with a 17% year-over-year decline in sales in China.
- Future Outlook: Analysts predict a significant rebound in Nike's earnings per share, forecasting $2.47 for fiscal 2027, up from $1.75 in fiscal 2026, indicating potential profitability recovery as the company overcomes the impact of Trump tariffs.
- Market Opportunities: The Chinese market presents substantial potential, with government plans to expand the sports industry to a $1 trillion market by 2030, and Nike, with its strong brand recognition and marketing strategies, may benefit from this growth in the coming years.
See More
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- Turnaround Strategy: Nike replaced CEO John Donahue with Elliott Hill in 2024, who is implementing the 'Win Now' strategy that leverages the brand's strength and innovation capabilities to reverse the performance decline, although overall sales growth remains sluggish and flat.
- Wholesale Channel Growth: The company's wholesale revenue improved by 8% in the most recent quarter, yet gross margin contracted by 3 percentage points due to tariff impacts, indicating that efforts to diversify sales channels are gradually bearing fruit.
- North America and Europe Markets: North America saw a 9% revenue increase, while Europe grew by 3% after adjusting for foreign exchange effects, suggesting that Nike's growth momentum in these regions is accelerating, despite a 17% year-over-year sales decline in China.
- Future Outlook: Analysts forecast Nike's earnings per share to reach $2.47 for fiscal 2027, a significant increase from $1.75 for fiscal 2026, and although the current stock price is around $60 with a price-to-earnings ratio of about 25, Nike is expected to achieve a strong rebound in revenue and profitability in the long term.
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