Nike Announces Forthcoming Layoffs Amid Reporting $790 Million In Losses

Source: Nike / NIke

The coronavirus pandemic has wreaked havoc on businesses of all sizes across the globe. Many that have been deemed essential or haven’t had restrictions placed on them still find it hard to operate with outbreaks of COVID-19 closing many businesses to once again shut down. For those retail locations that try to operate and haven’t had outbreaks, they face another problem; customers not coming in and spending in-store. The list of problems and situations is lengthy, but one thing is for sure; everyone is hurting, even the biggest retailers, such as Nike.

Earlier this week, Nike reported a record net loss of $790 million for its latest quarterly earnings. The company blamed the poor numbers partially on the strain COVID-19 placed on its business around the world. What’s more shocking is that same day, Nike’s CEO John Donahoe sent a company-wide email letting employees know the brand will soon be making “some difficult choices,” an email no employee wants to receive from their CEO in the middle of a pandemic. Donahoe went on in the email to not leave any doubt and state those difficult choices would “likely result in a net reduction of jobs.”

The most interesting part of all of this was that the CEO made sure to mention the layoffs would not be to reduce cost in response to the coronavirus as if that’s what employees who lost their job would care about. After Complex reported on the story, Nike released a statement to them to reassure cost wasn’t the reason for cuts.

“Consumer Direct Acceleration is the next digitally empowered phase of our strategy. We are building a flatter, nimbler company and transforming Nike faster to define the marketplace of the future. We are shifting resources and creating capacity to reinvest in our highest potential areas, and we anticipate our realignment will likely result in a net loss of jobs.

Reductions are not being done for cost savings. Any savings will be reinvested into our priorities.

We are committed to showing compassion and respect for our transitioning employees through thoughtful and robust severance practices, consistent with our company values, our legal obligations, the competitive marketplace and individual employee situations.”

If it wasn’t clear from the above statement, if you or someone you know losses their jobs at Nike during these layoffs, it wasn’t because of Coronavirus, the $790 million loss, or to save money.

Somehow making sure people know that, seems to be the company focus at the moment over letting their employees know if they’re being let go.