RESTRUCTURING CHARGES

12 Months Ended

Mar. 31, 2021

Fiscal Year 2021

In order to support the Company’s strategy and build a sustainable organization, and after considering that the economic recovery from the pandemic will be slower than anticipated, the Company identified certain structural changes to restructure the business. These restructuring actions will eliminate non-core activities primarily within the Company’s corporate function, align the Company’s cost structure with its reorganizing and optimizing of its operations model along its two reporting segments, and further sharpen its focus to winning business in end markets where it has competitive advantages and deep domain expertise. During fiscal year 2021, the Company recognized approximately $101.3 million of restructuring charges, most of which related to employee severance.

Restructuring charges are not included in segment income, as disclosed further in note 20.

Fiscal Year 2020

During the first half of fiscal year 2020 in connection with the geopolitical developments and uncertainties at the time, primarily impacting one customer in China, the Company experienced a reduction in demand for products assembled for that customer. As a result, the Company accelerated its strategic decision to reduce its exposure to certain high-volatility products in both China and India. The Company also initiated targeted activities to restructure its business to further reduce and streamline its cost structure. During fiscal year 2020, the Company recognized $216.4 million of restructuring charges. The Company incurred cash charges of approximately $159.3 million, that were predominantly for employee severance, in addition to non-cash charges of $57.1 million, respectively, primarily related to asset impairments.

Fiscal Year 2019

During fiscal year 2019, the Company took targeted actions to optimize its portfolio, most notably within its former Consumer Technologies Group segment. The Company recognized restructuring charges of approximately $113.3 million during the fiscal year ended March 31, 2019, of which $73.2 million were non-cash charges primarily for asset impairments. A significant component of its charges were associated with the wind down of its NIKE operations in Mexico in the third quarter of fiscal year 2019 where it recognized charges of $66 million primarily for non-cash asset impairments.

In addition, the Company executed targeted head-count reductions at existing operating and design sites and corporate functions and exited certain immaterial businesses. Of these total restructuring charges, approximately $99.0 million was recognized as a component of cost of sales during the fiscal year ended March 31, 2019.


	Severance		Long-Lived Asset Impairment		Other Exit Costs		Total
	(In millions)
Balance as of March 31, 2018	$	48	$	—	$	13	$	61
Provision for charges incurred in fiscal year 2019	39		46		28		113
Cash payments for charges incurred in fiscal year 2018 and prior	(41)		—		(4)		(45)
Cash payments for charges incurred in fiscal year 2019	(23)		—		(1)		(24)
Non-cash charges incurred in fiscal year 2019	—		(46)		(27)		(73)
Balance as of March 31, 2019	23		—		9		32
Provision for charges incurred in fiscal year 2020	123		46		47		216
Cash payments for charges incurred in fiscal year 2019 and prior	(15)		—		(3)		(18)
Cash payments for charges incurred in fiscal year 2020	(112)		—		(35)		(147)
Non-cash charges incurred in fiscal year 2020	—		(46)		(14)		(60)
Balance as of March 31, 2020	19		—		4		23
Provision for charges incurred in fiscal year 2021	89		8		4		101
Cash payments for charges incurred in fiscal year 2020 and prior	(14)		—		—		(14)
Cash payments for charges incurred in fiscal year 2021	(49)		—		(1)		(50)
Non-cash charges incurred in fiscal year 2021	—		(8)		1		(7)
Balance as of March 31, 2021	45		—		8		53
Less: Current portion (classified as other current liabilities)	42		—		8		50
Accrued restructuring costs, net of current portion (classified as other liabilities)	$	3	$	—	$	—	$	3