Levi Strauss, jolted by coronavirus-linked shutdowns of its retail stores, has decided to chop 700 corporate jobs, the legendary maker of denim jeans said Tuesday.
"The second-quarter results highlight the difficult external environment we've been navigating the last several months," Chip Bergh, Levi Strauss president and chief executive officer, said in an email distributed Tuesday to employees.
San Francisco-based Levi Strauss lost $364 million in its second fiscal quarter, which ended in late May, compared with a profit of $29 million for the year-ago second quarter, the company reported.
Revenue totaled $498 million during the second quarter, down 62% from $1.31 billion in the same period of last year.
Levi Strauss has decided to lay off 700 workers, which equates to 15% of its corporate staff worldwide, the company said Tuesday.
The big problem? For 10 of the 13 weeks during the second quarter, most Levi Strauss stores and most stores operated by the company's wholesale partners were closed due to coronavirus-linked shutdowns.
Sales of merchandise online weren't enough to buoy Levi Strauss in any meaningful way. "Although our online sales accelerated, it was not nearly enough to offset the revenue impact of closed doors," Bergh said.
Even though stores have begun to open their doors again, the situation is far from normal, according to Levi Strauss, a maker and retailer of clothes including denim jeans.
"While about 90% of our stores have now reopened around the world, as well as most of our franchise and wholesale partner doors, traffic and revenues continue to lag behind prior year," Bergh said.
Levi Strauss has spotted some signs of improvement, however.
"Although we are starting to see some green shoots, we need to continue to be cautious," Bergh said. "We still face many unknowns."
