Burberry

History

2025: Reduction of 18% of the state

In mid-May 2025, British luxury clothing, perfume and accessories maker Burberry announced plans to cut 1,700 employees, 18% of the company's total workforce. This decision was made against the background of financial difficulties - at the end of the 2025 financial year, which ended on March 29, the company recorded a net loss of £3 million ($4 million) against a profit of £418 million a year earlier. Burberry's revenue for the reporting period fell 17% to £2.46 billion, while comparable retail sales declined 12%.

According to Bloomberg, the staff reduction program will be implemented by 2027 and will allow the company to save about £60 million ($80 million) over two years. In addition to optimizing staff, Burberry plans to reduce procurement and real estate costs. In its official report, the company explained the measures taken by the increased uncertainty of the economic situation in the light of geopolitical events.

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Фото: Reuters

Analysts attribute Burberry's deteriorating financial performance to several key factors. Among them are weakening consumer interest in the collections of designer Daniel Lee, who has been with the company for more than two years, as well as an overall cost-of-living crisis that is negatively affecting the luxury market.

Burberry CEO Joshua Shulman, who took over the post in the summer of 2024, has been making attempts to boost the popularity of the company's outerwear, including classic trench coats. However, as Third Bridge analyst Janmei Tan points out, the trench coat, while a cult product of the brand, is rarely re-purchased by consumers, unlike the trending things customers return for regularly.

The current staff cuts are not the first in the company's recent history. In 2020, Burberry has already eliminated 500 positions due to falling demand for luxury goods during the COVID-19 pandemic. The global decline in consumer interest in luxury goods has led to the accumulation of significant product stocks in premium brand stores, independent boutiques and online retailers around the world.^[1]

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