By Neil J Kanatt and Nicholas P. Brown

Jan 26 (Reuters) - Nike ( NKE ) is laying off 775

employees, a source familiar with the matter told Reuters on

Monday, as the sportswear giant looks to ‌boost profits and

accelerate its use of automation.

The cuts will primarily impact distribution center roles in

Tennessee and Mississippi, where ​the sneaker giant operates

large warehouses, the person said.

Nike ( NKE ), whose business is struggling, ‍is trying to reestablish

itself as the world's leading sportswear ⁠brand after losing

market share ⁠to rivals. It has undergone several rounds of

layoffs in recent years.

In August, it cut a little less ‌than 1% of its corporate

workforce as ​part of its turnaround efforts under CEO Elliott

Hill, who took over the top job in 2024.

It had previously announced it would cut ⁠2% of its jobs -

more than 1,600 ‍in total - ​in February 2024.

Monday's layoffs were first reported by CNBC.

In a statement to Reuters, Nike ( NKE ) said it was "taking steps to

strengthen and streamline our operations so ‍we can move faster,

(and) operate with greater discipline."

The move will primarily impact its distribution operations

in the U.S., the company said.

"Nike's ( NKE ) sales trends over the past two years have been well

below normal, so it's highly likely that it overbuilt warehouse

capacity and overstaffed," said Morningstar analyst David Swarz.

Coupled with the rapidly increasing ​capabilities of ‍AI, the cuts

were "not surprising", he said.

Nike ( NKE ) had 77,800 employees worldwide, including retail and

part-time staff, as of May 2025, when it published its last

annual ​report.

Under Hill, the company has been investing heavily in its

sneaker lines as it tries to refocus the brand on core sports

such as running and soccer.

Nike ( NKE ) reported a drop in gross margins for the second

consecutive quarter in December, as poor sales in China and

efforts to reset its product mix continued to vex it.

It also recently suffered a data ​breach that saw hackers

release a trove of corporate data.

Nike ( NKE ) said in its statement on Monday that the layoffs "are

designed to reduce complexity, improve flexibility, and...

support our path back to long-term, profitable growth".