Embattled Burberry to cut 1,700 jobs amid turnaround

Burberry on Wednesday announced a slew of organizational changes, amid continued turnaround efforts at the embattled luxury house.

The company said the measures could lead to a “reduction in people-related costs which could impact around 1,700 roles globally” over the lifetime of the program, set to complete in 2027.

The moves — which include cost cutting across procurement and real estate — are estimated to lead to cost savings of £60 million ($79.9 million) and mark the latest phase of CEO Joshua Schulman’s strategy to improve revive the fortunes of the heritage British brand. It follows £40 million in cost cutting measures announced in November, taking totaled estimated cost savings to £100 million.

The job cuts will impact around 20% of Burberry’s overall headcount, with the majority set to take place in office-based roles, as well as within stores and at its factory in Castleford, England.

Shares jumped 8.5% shortly after market open in London.

Burberry sales fell slightly less than expected in the fiscal fourth quarter, down 6% in the three months to March. Analysts had anticipated a 7% decline in a company-compiled consensus estimate.

For the fiscal year, sales were down 12% versus an anticipated 13% decline. Total revenue for the year was £2.461 billion ($3.273 billion), slightly ahead of an estimated £2.451 billion.

Sales fell across all regions over the year and the quarter, led by weakness in Asia-Pacific. Sales in the Americas — which had been a bright spot of positive performance in the third quarter — swung to a 4% loss in the three months to end the fiscal year.

Burberry had previously flagged the U.S. as a bright spot in third-quarter sales. However, the fashion house said Wednesday that “current macroeconomic environment has become more uncertain in light of geopolitical developments.”

“While we are operating against a difficult macroeconomic backdrop and are still in the early stages of our turnaround, I am more optimistic than ever that Burberry’s best days are ahead and that we will deliver sustainable profitable growth over time,” Schulman said in a statement.

The company did not provide specific guidance on the estimated impact of U.S. tariffs. It flagged an “increase in geopolitical tension which leads to incremental unmitigated tariff risks compared to the central planning scenario” as a key downside risk.

Burberry Chief Financial Officer Kate Ferry said the tariff impact was currently “very dynamic” and that the company would not be drawn on exact figures.

“We are a well diversified business. The U.S. is really important but it is 19% of our business. Wherever tariffs end up, we’ll be able to respond,” Ferry said during an earnings call on Wednesday.

Schulman in November announced urgent plans to “course correct” after a prolonged period of underperformance for the company amid waning sales and a slew of management changes.

The strategic overhaul marks the latest iteration of the 169-year-old retailer. Schulman joined in July from Michael Kors, becoming the brand’s fourth CEO in the last decade.

This is a developing story. Please check back for updates.