Burberry plans to cut almost one-fifth of its global workforce
Burberry is aiming to slash 18% of its global workforce by 2027 as it looks for ways to cut costs and revive its ailing business.
The British luxury fashion house said Wednesday that around 1,700 jobs were at risk as it reported a loss of £3 million ($4 million) during its latest financial year. Revenue also fell sharply in the 12 months to March 29, the company said in its preliminary results.
Like other high-end fashion brands, Burberry has grappled with a global slowdown in luxury spending in recent years, with its stock slumping 66% since an all-time high hit in April 2023.
The planned job cuts are part of changes aimed at increasing 'agility, driving efficiency and profitability' at the 169-year-old company, including making other savings. By the 2027 financial year, Burberry said, it hopes to unlock £100 million ($133 million) in annual savings.
Burberry's stock jumped more than 9% Wednesday morning following the results.
The company noted in its results that 'the current macroeconomic environment has become more uncertain in light of geopolitical developments' — a likely allusion to US President Donald Trump's trade war, which has made a number of products more expensive and consumers more cautious.
Last year, luxury wear veteran Joshua Schulman took over as Burberry's chief executive to help the company revive its fortunes. He said in a statement Wednesday that Burberry is 'operating against a difficult macroeconomic backdrop' and is 'still in the early stages of (its) turnaround.'
Part of that turnaround has been a renewed focus on the products Burberry is best known for — trench coats and scarves — as well as bringing down prices for bags and shoes.
'Burberry is dealing with difficult conditions in the mid-market luxury sector,' Susannah Streeter, a senior analyst at investment platform Hargreaves Lansdown, wrote in a note Wednesday. 'It doesn't have the same pull of its ultra-luxe rivals, and aspirational shoppers are more cautious, without the deep pockets of wealth to keep them insulated.'
Jordan Valinsky contributed reporting.
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