Converse Reveals Job Cuts as Nike Inc. Layoffs Continue
Converse is cutting roles as part of a general Nike Inc. business restructuring plan, the company confirmed to FN.
In a statement, Converse said it “is realigning some of our teams and optimizing the way we work in support of our biggest growth opportunities.” The company also said that it “is continually taking steps to support our future growth.”
The job cuts are part of Nike’s previously announced layoffs amid a general plan to “streamline” the organization and save up to $2 billion in costs over the next three years, the company said in December. At the time, Nike alluded to layoffs and said it could soon face employee severance costs as it rolled out the strategic plan.
In February, Nike confirmed that it was laying off 2 percent of its workforce and in April, disclosed via a filing with the state of Oregon that 740 employees will have been let go at the global headquarters as part of two rounds of layoffs by June. As early as November, several Nike employees had taken to LinkedIn to share they were laid off from the company amid a broader C-suite shakeup across design and marketing.
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Nike did not confirm how many roles were impacted at Converse, which it acquired for $305 million in 2003. Bloomberg News first reported on the cuts.
Nike has recently faced criticism for what experts and analysts see as a lack in innovation in its product pipeline. In December, Nike touted a new plan to build a “multiyear cycle of innovation” to win over consumers, which in part included streamlining the distribution of some of its key franchises to drive more brand heat. Since then, Nike has touted new products like the Air Max DN, the Pegasus Premium and the Pegasus 41.
In explaining the Swoosh’s innovation lag, Nike chief executive officer John Donahoe recently ignited backlash when he said remote work was to blame. According to analysts, Nike’s innovation issues stem from relying too heavily on best-sellers instead of creating new franchises, as well as a broad loss of talent at the top and prioritizing financial goals over brand equity.
