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Converse footwear brand is reportedly cutting jobs as parent company Nike Inc. (NYSE:NKE) continues its cost-saving measures by reducing its workforce.
Nike is implementing a $2 billion plan to reduce expenses, which includes eliminating 2% of its global workforce. The layoffs have affected its Oregon headquarters in two phases and are expected to be completed by the end of its fiscal year, reported Bloomberg.
Converse, based in Boston, handles its own product development, supply chain, and marketing. The brand also incorporates Nike technology into its products.
The report cited a Converse spokesperson, who said Converse “is realigning some of our teams to better support future growth.”
"We can confirm that the total changes to Converse's workforce were included in Nike's overall 2% reduction plan, however, we were operating on a discrete timeline.”
Converse, famous for its Chuck Taylor and One Star sneakers, accounts for about 5% of Nike’s total sales.
Nike reported third-quarter revenue of $12.429 billion, beating the consensus estimate of $12.281 billion. Adjusted earnings per share of 98 cents beat a Street consensus estimate of 74 cents per share.
In December, Nike unveiled a cost savings plan targeting $2 billion over three years. By February, it planned to cut over 1,600 jobs, roughly 2% of its workforce.
Nike stock has lost more than 22% in the last 12 months. Investors can gain exposure to the stock via Vanguard Consumer Discretionary ETF (NYSE:VCR) and Fidelity MSCI Consumer Discretionary Index ETF (NYSE:FDIS).
Price Action: NKE shares closed higher by 0.07% at $92.79 on Tuesday.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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