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Ralph Lauren Corp
650 Madison Ave
Phone: (212) 318-7000p:212 318-7000 NEW YORK, NY  10022-1029  United States Ticker: RLRL

Business News: Ralph Lauren To Cut 15% Of Workforce


Ralph Lauren Corp. said it would cut its workforce by roughly 15%, reflecting a sharp drop in revenue tied to coronavirus-related store closures this year and potential challenges ahead with the economic recovery.

A spokeswoman for the New York-based company declined to specify how many employees would lose jobs. Ralph Lauren employed roughly 24,900 people globally as of late March, including 13,800 in the U.S., according to its most recent annual report. The company plans to reduce staff by the end of its current fiscal year.

Last month, finance chief Jane Nielsen said Ralph Lauren expects the pandemic and what she described as a prolonged return of demand to hamper revenue and operating profit during the fiscal year.

Fashion retailers like Ralph Lauren and department-store operators have faced a difficult path after closing stores this year to halt the spread of the coronavirus. They reopened to an altered shopping landscape, with more people shopping online or at big-box chains such as Walmart and Target, which were deemed essential for their merchandise arrays that include food and medicine. Those chains have reported stronger sales in recent months.

Other retailers with a focus on apparel also have moved to cut jobs due to falling sales. Kohl's Corp. said last week it cut about 15% of its corporate staff. In June, Macy's Inc. said it would lay off some 3,900 corporate employees. Many have filed for bankruptcy.

For its fiscal first quarter ended June 27, Ralph Lauren's revenue fell to $487.5 million from $1.43 billion a year earlier. It said in August that most stores in major markets were closed for an average of eight to 10 weeks during the period, resulting in much weaker foot traffic and thus lower demand.

The company showed a loss of $127.7 million in the quarter, in contrast to a profit of $117.1 million a year earlier.

Ralph Lauren expects to record charges of about $120 million to $160 million related to the job cuts. It said it anticipates saving at least $180 million annually on a gross basis due to the reductions, with most of the savings starting with its 2022 fiscal year.

The company has also said it is examining other parts of its business, including its real estate, as it looks for savings.


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