Nike warns of layoffs and weak sales guidance as shares fall to2013 levels
Nike told investors on Thursday to expect layoffs, weaker profitability and fewer Jordan shoe launches. The warning came as the sportswear company's shares fell to levels last seen in September 2013.
Nike closed Thursday's regular trading session with a market value of about $53 billion, down from $264 billion at its November 2021 peak. The shares then fell a further 9% in after-hours trading.
The company, known for shoes and sportswear sold under the Nike, Jordan and Converse names, also said it plans to pull back from discount online sales channels in China and to reduce the number of retro shoe releases.
The numbers behind the drop
- Revenue for the quarter fell 4% to $11.2 billion, slightly below the $11.3 billion analysts expected.
- Earnings of 48 cents a share were above the $0.43 to $0.44 estimate.
- Nike expects full-year sales to fall by a high single digit percentage, with adjusted earnings of $1.15 to $1.35 a share. Analysts had projected $1.68.
- The market value of the company stood at about $53 billion, down from $264 billion in November 2021.
- Shares dropped 9% in after-hours trading after the regular session closed.
Guidance is a company's own estimate of how its results will look over the coming period. It is a prediction by management, not a confirmed result.
What CEO Elliott Hill said on the call
CEO Elliott Hill explained the China decision by saying: "The majority of our partners' physical doors in Greater China haven't been refreshed in the past seven years."
On the Jordan brand, he said: "Simply put, we've been oversupplying our iconic retro product." Nike wants to release fewer and rarer versions of its retro shoes.
Nike also presented a new restructuring programme called Pace. The company says it will save a total of $2.5 billion by 2031. The plan includes a new campus in India and a reduction from four sales regions to three. Layoffs under the programme are scheduled to begin in 2027.
Where sales weakened
- Greater China, once a main growth area for Nike, fell 26% when the figures are adjusted for currency movements.
- The Converse division dropped 28% to $263 million, with declines in every region.
- Nike's own digital sales fell 13%.
- Jordan revenue, which made up 13% of company sales in the quarter, fell by about the same amount.
Job cuts announced earlier in 2026
Before the new programme, Nike said it had already cut 775 distribution centre jobs in January and announced about 1,400 more cuts, mostly in technology roles, in April.
The source material does not say how many employees the Pace programme will affect.
Reaction and index changes
Television personality Jim Cramer, who spent years defending the stock on CNBC, said: "Nike guide horrendous."
Crypto influencer Threadguy posted about Nike's falling popularity, writing: "Go to the gym and count how many people are wearing Nike shoes. Pretty alarming." That comment is an opinion, not a measured figure.
The S&P Dow Jones index committee removed Nike from the S&P 100 index this month, effective 21 September, ending an 18-year run in the index.
Nike remains in the Dow Jones Industrial Average, a list of 30 large US companies used to track the US stock market. Its weight in that index is now 0.4%, the smallest of the 30 companies.
What is confirmed and what is not
Confirmed from Nike's own earnings report: the quarterly revenue and earnings figures, the full-year guidance, the Pace restructuring programme and its $2.5 billion savings target, the China channel decision, and the cutbacks to retro product releases.
Not confirmed: the number of jobs to be cut, the reason behind every share price reaction, and any comment from Threadguy, which was an unverified personal impression.
The share price fall is reported market data. The 13-year low and the September 2013 comparison describe where the price traded, not a forecast of where it will go.
What happens next
Layoffs under the Pace programme are due to start in 2027, with cumulative savings of $2.5 billion targeted by 2031. Nike also plans to open a new India campus, reduce its sales regions from four to three, and wind down most online discount channels in Greater China.
Sources
Newisty Editorial Team covers technology, cryptocurrency, digital products, online platforms, developer tools and the wider digital economy. Our content is researched from official sources, company announcements, public documentation, market data and other primary or reputable sources. Articles are reviewed and edited before publication for clarity, accuracy and useful context.