British luxury fashion house Burberry has revealed plans to eliminate 1,700 positions globally by 2027 as part of an accelerated cost-cutting initiative following a 117% fall in its annual pretax profit for fiscal year 2025 (FY25).

The company’s revenue for the 52-week period ending on 29 March 2025 dropped 17% to £2.46bn ($3.25bn) compared with £2.97bn in the previous year.

The majority of the job reductions are set for the company's head offices, including its London headquarters, Burberry CEO Joshua Schulman said in the company's earnings call.

Additional cuts will result from restructuring staff schedules in retail locations and eliminating one production shift at the Castleford factory.

Schulman said: "For a long time we have had overcapacity at that [Castleford] facility, and that is simply not sustainable. But I want to be very clear that we are making this change to safeguard our UK manufacturing, and in fact we will be making a significant investment to renovate this factory in the second half [of FY25]."

The layoffs are part of a broader strategy to achieve £60m in cost savings that comes in addition to a previously announced £40m savings programme from November last year.

The combined annual savings target for the company is set at £100m by FY27.

Besides workforce reduction, additional savings will come from reduced operating expenses through more efficient procurement and real-estate management.

Burberry reported an adjusted operating profit of £26m in FY25, which represents a sharp decline of 94% from £418m in the comparable period ending 30 March 2024.

Its adjusted operating margin for FY25 also fell dramatically to 1.0%, down by 1,300 basis points from 14.1% in the previous year.

Additionally, the company suffered an operating loss of £3m for FY25, compared to an operating profit of £418m a year earlier.

Schulman said: "The continued resilience of our outerwear and scarf categories reaffirms my belief that we have the most opportunity where we have the most authenticity.

"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."

"Burberry aims for £100m savings amid FY25 profit dip, 1,700 job cuts" was originally created and published by Retail Insight Network, a GlobalData owned brand.

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