NEW YORK, NY / ACCESSWIRE / June 16, 2017 / Nike's shares dropped on Thursday after the company announced it would be making some serious job cuts around the world that would result in about 1,400 jobs being let go. Mattel shares also sank after the company revealed it would be cutting its dividend in half.
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NIKE, Inc. closed in the red down 3.22% on Thursday after the company revealed that it would be cutting 2% of its global workforce. The sportswear apparel company announced that as part of a restructuring plan, it would be cutting about 1,400 jobs. It also announced it would be slashing the number of styles it offers and would focus more on online shoe sales. CEO Mark Parker commented, "We're getting even more aggressive in the digital marketplace." Matt Powell, a sports industry analyst working at NPD criticized Nike for being behind on trends and said, "Nike missed the fashion shift away from performance basketball to retro. They still have not caught up." Nike also revealed that its main focus would be 12 cities where the company expects to see more than 80% of its projected growth through the year 2020. The cities include Los Angeles, New York, Paris, London, Milan, Mexico City, Seoul, Shanghai, Tokyo, and Beijing.
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Mattel, Inc.'s shares closed down 6.68% yesterday and even hit a new low of $20.29 during intra-day trading. The struggling toy maker announced on Thursday said that it was planning to cut its dividend more than half. Traders were less than pleased to hear about this. The company's goal is to fund its business transformation initiative with the cut. CEO Margo Georgiadis plans to use funds to modernize the company's brands and enter new markets around the world. The Barbie and Hot Wheels maker had a dividend of $0.38 in previous quarters and is now planning to pay out $0.15 per share for the fiscal third quarter. CEO Georgiadis has plans to build out Mattel's digital connected toy footprint in the country of China with the intent of seeing its share grow three to four times in China's toys market.
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