Nike has announced the elimination of 775 positions across its U.S. distribution centers in Tennessee and Mississippi, representing approximately 1% of its global workforce of 77,800. The company cited the move as part of a broader effort to implement advanced robotics, automated sortation and digital warehouse management systems. Sources indicate that the new automated equipment, including autonomous mobile robots and high-speed conveyor sorters, will be fully integrated by Q4 and is expected to process up to 25% more units per hour compared with current manual operations.

Under CEO Elliott Hill’s ‘Win Now’ turnaround strategy, Nike is rebalancing its distribution network after expanding capacity during the previous D2C push. Volumes at these centers have declined by nearly 8% year-over-year as the company restores partnerships with wholesale retailers. By consolidating operations and retiring older facilities in the Southeast, Nike projects annual savings of $45 million in labor and fixed-cost overhead. The automation rollout is being funded through a $120 million capital expenditure budget for fiscal 2026.

Nike expects the combination of labor reductions and technology investments to improve its adjusted EBIT margin by 50 to 75 basis points over the next 12 months. The company noted that digital sales, which fell 15% in the last quarter, will benefit from faster order fulfillment and lower fulfillment costs per unit. Investors will be watching whether the streamlined network and reduced complexity can help Nike return to mid-single-digit revenue growth and stabilize gross margins, which declined to 40.7% in the prior fiscal year.