Denim maker Levi Strauss & Co. to reduce at least 10% of its workforce

Jeans maker Liv Strauss & Co. on Thursday evening announced that it will cut 10 to 15 per cent of its global corporate jobs amid weakness in its wholesale business, according to news agency Reuters. 

Levi's has about 20,000 workers globally, with roughly 5,000 corporate employees. The layoffs are expected to take place in the first half of 2024. 

The company attributed its weak forecast to weaker foreign currency exchange rates, the liquidation of its Russia business and its plans to exit the Denizen brand. 

Levi’s has asserted that exiting the Denizen business would allow it to improve its margins and focus on other categories like athletic wear. 

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Michelle Gass, the company’s chief executive officer, said that its US business has improved over the last quarter but Levi’s would continue to be conservative in outlook owing to unpredictable consumer demand.

Gass said, "There's been a lot of volatility this past year...so we are taking a cautious approach as we look forward."

Moreover, the company is also facing delays of 10-14 days in transit owing to disruptions in the Red Sea, according to Harmit Singh, its chief financial and growth officer. 

The company projected fiscal 2024 net revenue growth of 1 per cent to 3 per cent, compared with analysts' estimate for a 4.7 per cent increase to $6.49 billion, according to LSEG data.

Levi's expects adjusted per-share profit of $1.15 to $1.25, lower than estimates of $1.33.