A pedestrian looks at a smartphone while passing a Nike store in Shenzhen, Guangdong province, China, on May 31, 2026.
Chen Xin | Getty Images
nike Shares fell on Friday, falling for the second day in a row after the company announced lower revenue and plans to cut jobs in 2027.
The sportswear giant said Thursday that first-quarter sales fell 4% to $11.2 billion, citing declines in Greater China that were partially offset by growth in its North American division. Net income was $712 million, down 2% from $727 million a year earlier.
“We still have a lot of work to do at Nike Sportswear, Jordan Brand and Greater China, and we are taking intentional actions to strengthen these businesses in the right way for the long term,” Nike President and CEO Elliott Hill said in a release.
Nike expects 2027 sales to fall to the low single digits. The company’s stock price fell about 6% in Friday morning trading and is down nearly 45% since the beginning of the year.
Nike stock since the beginning of the year.
The company also announced a new operating model called PACE, which is expected to reduce costs by $2.5 billion by 2031, and plans to begin further job cuts starting in 2027.
In a separate announcement Thursday, Hill said, “This initiative will reduce my role across Nike. I want to acknowledge that news like this creates uncertainty, and I don’t take that lightly.” “Determinations regarding affected roles related to this job will begin in calendar year 2027 or later.”
The program also includes efforts to modernize Nike’s global supply chain, organize it into three regions, establish a new campus in India and further streamline the organization to reduce costs.
“Talk about cost reduction”
Nike has already cut jobs twice since the start of the year, including cutting 775 jobs across its U.S. distribution centers in January and laying off an additional 1,400 employees, mostly in technology, in April.
Citi analysts said in a note Friday that they remain “neutral” on the company because its revenue outlook fell short of market expectations.
“Nike has turned to cost-cutting talk, announcing a $2.5 billion cost-cutting program as management adjusts to the realities of sportswear, Jordan and significant domestic pressures in China,” Citi analysts said.
They noted that management plans to provide more detailed information on its five-year outlook at an investor presentation, but details about when Pace will actually “move the dial” will only emerge in 2029.
“While it is not out of the question that Nike could exceed some of the guidance it has just provided, there is (in our view) no good reason for Nike to receive a premium multiple relative to its growing peers,” they added.
