Nike will eliminate 775 positions across its U.S. distribution centers in Lebanon, Tennessee and Olive Branch, Mississippi, representing roughly 1% of its total global workforce of 77,800 as of May. The cuts follow a 1,000-role corporate reduction in summer 2025 and over 1,500 roles trimmed in early 2024. Nike says the action is intended to ‘sharpen its supply-chain footprint, accelerate the use of advanced technology and automation, and invest in the skills our teams need for the future.’

Under incoming CEO Elliott Hill, Nike has pulled back from the direct-to-consumer emphasis introduced by former CEO John Donahoe, whose D2C focus drove a surge in warehouse volumes. After Nike Direct sales fell 12% year-over-year and digital revenues dropped 15% in early 2025, management pivoted to strengthen relationships with wholesale partners. Lower volumes at its U.S. distribution hubs have prompted the company to streamline operations and reduce labor complexity.

Nike expects these distribution cuts to contribute to its ‘path back to long-term, profitable growth’ by reducing operating complexity and improving flexibility. In its March 2025 earnings call, CFO Matthew Friend noted the firm was reducing promotional days and markdown rates to protect gross margins, which had declined for two consecutive quarters entering December. The company forecasts that automation investments and a leaner footprint will drive incremental gains to its EBIT margin over time.

Investors will watch how accelerated automation and a recalibrated supply-chain strategy translate into higher operating discipline and margin expansion. With running-shoe rivals and lifestyle brands closing the style gap, Nike’s ability to balance cost savings with consumer responsiveness will be critical. Stakeholders will also monitor any future shifts in labor strategy as the broader U.S. distribution sector moves toward increased robotics and AI-enabled processes.