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Levi Strauss to cut corporate workforce by 15 percent

By Hugh Fort in US business news, posted January 26, 2024

Levi Strauss has announced a two year plan to increase productivity, including reducing global staff by 10 to 15 percent.

The denim giant, based in San Francisco, revealed its intention to enhance worldwide productivity by reducing its global corporate staff in the first half of this year.

In an interview, Levi Chief Financial Officer Harmit Singh said: "Our existing structure was designed for a much larger operation, necessitating a resizing."

For the quarter ending November 26, Levi reported a net income of $126.8 million, or 32 cents per share.

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This is a decrease from the $150.6 million, or 38 cents per share, reported in the same period the previous year.

The company's sales increased by 3.3 percent to $1.64 billion, slightly below the expected $1.66 billion as per FactSet's data.

Levi attributed its overall positive results to renewed revenue growth in the Americas, following a 5% to 6% cut in wholesale prices at the end of the third quarter.

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Singh added: "We are seeing positive results from the reduction in wholesale prices, though we don't plan further cuts."

Levi expects a revenue growth of one percent to three percent, with adjusted earnings per share projected between $1.15 and $1.25.

Despite the positive trends, particularly in the U.S. and Europe, Singh expressed a cautious outlook.

The company's restructuring plan aims to save $100 million in fiscal 2024.

It will also result in restructuring charges ranging from $110 million to $120 million in the first quarter.

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