Cousin Greg’s date and her “ludicrously capacious bag” might have unwittingly triggered Burberry’s downfall. While major luxury brands like LVMH and Kering have dropped ~21% and ~36%, respectively, over the past year, Burberry stands out like “a lunch pail” and has fallen 64% in the same time.
After yet another rocky quarterly performance, the British luxury brand slashed its dividend and fired CEO Jonathan Akeroyd — bringing in Joshua Shulman, the former CEO of Michael Kors, Coach, and Jimmy Choo, as the new leader.
- In 2022, Burberry brought on Daniel Lee, who had previously revamped Bottega Veneta, as its chief creative officer in an attempt to take Burberry in a new direction by making it “cooler, haughtier, edgier.”
- But this shift coincided with a luxury market slowdown that led to Burberry’s retail sales declining 22% in the latest quarter — and on the wholesale side, the company expects revenue to decrease by 30% for 2025.
High fashion, low demand: The luxury spending slowdown has affected the entire industry’s sales, but Burberry’s challenges are compounded by its heavy reliance on Chinese consumers, who have cut back on luxury spending amid economic troubles. The downturn has been so severe that CFO Kate Ferry has hinted at potential job cuts as the company seeks to lower costs.
