Luxury goods in the cold winter! Canada Goose cuts 17% of its workforce, with stock prices falling by over 3%

On March 26, due to weak demand, Canadian high-end clothing brand Canada Goose announced a 17% workforce reduction, affecting employees at its headquarters.

Following the announcement, Canada Goose's stock price dropped by over 3%.

The exact number of layoffs has not been specified yet. According to a recent securities filing, as of April 2023, the company's headquarters staff increased from 544 people in April 2021 to approximately 915 people, nearly doubling.

In the quarter ending on December 31, Canada Goose's sales increased by 6% year-on-year, falling short of analysts' expectations. Canada Goose expects that cost reduction and increased efficiency and speed of decision-making will be achieved through the layoffs.

Canada Goose CEO Dani Reiss stated in a release:

"To enhance efficiency and profitability, we are making adjustments to the team to ensure all resources effectively support the company's goals and plans. At the same time, we are increasing investments in key areas, including brand building, design innovation, and operational optimization. These strategies will strengthen our high-end brand image and promote the sustainable development of our business."

The luxury goods industry is facing challenges, with not only Canada Goose implementing layoffs, but also luxury giant Kering Group warning on March 20 that "its brand Gucci's sales will plummet by 20%", causing the company's stock price to drop by over 14% at one point, marking the largest single-day decline since 1992.

Furthermore, in recent months, several retailers such as Under Armour, Nike, Macy's, Wayfair, Hasbro, and Etsy have also announced large-scale layoffs