Burberry to Cut 1,700 Jobs in Turnaround Push

New York Times

14-05-2025

Burberry, the British fashion brand known for its trench coats and signature checkered print, said on Wednesday that it would slash up to 1,700 jobs in a bid to cut costs as it tries to return to profit after a period of poor sales in an increasingly volatile luxury sector.
The job cuts, which represent 18 percent of the company's global work force, are part of larger organizational changes that are expected to save the company 60 million pounds. The measures come amid global uncertainty that increased after President Trump imposed tariffs on America's top trading partners.
'The current macroeconomic environment has become more uncertain in light of geopolitical developments,' the company said in a statement.
The company announced the cost-cutting strategy after reporting a 117 percent drop in its annual pretax profits in the 2025 financial year, which ended March 29. Operating losses were £3 million, or $4 million, down from a £418 million, or $558 million, profit the year prior. Revenue was down 17 percent to £2.5 billion, or $3.4 billion.
Burberry has struggled in recent years after managerial and designer changes, a drive to increase prices that fell flat with customers and the wider global slowdown of luxury consumption, particularly in China, its biggest overseas market.
The company said the cost-cutting efforts, combined with earlier measures, could lead to planned savings of up to £100 million, or $133 million, by 2027. Most job losses will hit corporate offices but could also affect retail stores and factories.
Shares jumped by as much as 10 percent on the news after the market opened in London.
The company's chief executive, Joshua Shulman, joined Burberry from its American rival, Coach, last year to lead a turnaround effort. He said in a statement on Wednesday that he was 'more optimistic than ever that Burberry's best days are ahead and that we will deliver sustainable profitable growth over time,' but added that the last financial year had been challenging.
Charlie Huggins, a manager at the investment firm Wealth Club, noted that a 6 percent decline in same-store sales in the fourth quarter was 'a marked improvement' and suggested that 'the strategic plan to reignite the brand may be gaining early traction.'
'But fiscal year 2025 was still an annus horribilis for Burberry, ' he said. 'Almost everything that could go wrong did. Luxury consumers across the globe significantly tightened their belts hitting the whole luxury sector. But Burberry has seen more impact than most.'
Other groups that noted earnings declines recently include LVMH, owner of Louis Vuitton and Dior, and Kering, which owns brands like Gucci and Saint Laurent.