Fashion giant Burberry has announced a major shakeup in its leadership and financial strategy.
The company, known for its iconic trench coats, has parted ways with its CEO, Jonathan Akeroyd, after two years.
Akeroyd’s departure, described as a mutual decision, comes alongside Burberry’s warning that its annual profits will fall short of expectations.
Joshua Schulman, former CEO of Coach and Jimmy Choo, has been named as Akeroyd’s successor.
Burberry’s shares plummeted by 10% in early trading on Monday, following the announcement.
Schulman, an American with a reputation for revitalising luxury brands, will assume his new role on July 17, operating from Burberry’s London headquarters.
Under Akeroyd’s leadership, Burberry aimed to emphasise its British heritage and elevate its brand image with the help of creative director Daniel Lee, who joined in 2022.
Despite these efforts, the company has faced challenges in the luxury market downturn.
“Josh is a proven leader with an outstanding record of building global luxury brands and driving profitable growth,” stated Burberry chair Gerry Murphy.
Analyst Luca Solca of Bernstein noted that Burberry’s attempts to reposition its brand and relaunch under Daniel Lee had not yielded the desired results.
The company had resorted to heavy discounting of its products online and elsewhere, which is because it struggled to attract customers.
Burberry has also suspended its full-year dividend to reinforce its balance sheet.
The company’s first-quarter performance has been weak, with sales dropping 21% across all markets except Japan.
This decline has prompted fears of an operating loss for the first half of the year and an underwhelming annual profit forecast.
