The well-known luxury brand Canada Goose announces a global layoff of 17%

On March 26th local time, the well-known luxury brand Canada Goose announced that, as a key step in its "transition plan," the company has decided to implement layoffs globally, affecting approximately 17% of its workforce. Data indicates that as of April 2023, the company had 4,760 employees, suggesting that the number of employees laid off could be as high as 800.

On February 1st, Canada Goose released its third-quarter financial report for the 2024 fiscal year (covering the three months ending on December 31, 2023). The cold climate of the third fiscal quarter is particularly crucial for Canada Goose, typically contributing about half of its annual revenue. In the third fiscal quarter, Canada Goose's annual revenue increased by 6% year-on-year to CAD 610 million (approximately RMB 3.27 billion), growing by 5% at fixed exchange rates, while net profit attributable to shareholders decreased by 3.2% year-on-year to CAD 131 million (approximately RMB 700 million). The gross profit margin was 73.7%, up 1.5 percentage points year-on-year.

The Asia-Pacific region's revenue surpassed that of North America for the first time, marking the highlight of this fiscal quarter. Specifically, the Asia-Pacific region contributed CAD 271 million (approximately RMB 1.46 billion), accounting for 44.4% of the overall revenue; Canada, the United States, and EMEA (Europe, Middle East, and Africa) accounted for 15.6%, 25.8%, and 14.2% of the revenue, respectively. Prior to this quarter, revenue from the Canadian and American markets combined had always exceeded that from the Asia-Pacific region. Specifically, revenue from Canada decreased by 13.1% year-on-year to CAD 95 million, revenue from the United States decreased by 13.8% year-on-year to CAD 158 million, and revenue from the EMEA region decreased by 25.9% year-on-year to CAD 87 million.

From the 2018 fiscal year to the 2023 fiscal year, Canada Goose's annual revenue increased from CAD 591 million to CAD 1.217 billion. Except for a 5.7% decline in revenue in the 2021 fiscal year due to the COVID-19 pandemic, the company has maintained double-digit growth every year.

According to information disclosed on the Canada Goose official website, among its existing 66 flagship stores, there are 18 in Chinese mainland and 4 in Chinese Hong Kong, Macau, and Taiwan combined. In the 2023 fiscal year, Canada Goose opened a total of 10 flagship stores globally, with 4 of them in the Chinese market. In June 2023, Canada Goose opened its largest flagship store in the world in Sanlitun, Beijing. It is understood that Canada Goose officially entered the Chinese market in the second half of 2018 and now has nearly 23 flagship stores, making it the region with the largest number of Canada Goose flagship stores in the world, far exceeding the 9 stores in its home country of Canada.

According to information disclosed by Canada Goose, the company plans to open 16 flagship stores in the United States, Chinese mainland, and Japan, etc. in the 2024 fiscal year.

In the past two years, with the rise of domestic down jacket brands such as Bosideng and SKYPEOPLE, and the intensified layout of foreign high-end down jacket brands such as Moncler, competition in the Chinese high-end down jacket market has continued to intensify.

Recently, with uncertain global macroeconomic prospects, consumers have become increasingly cautious in their shopping habits, causing a downturn in the luxury goods industry. Previously, luxury giant Kering Group issued a profit warning, stating that due to weak performance in the Asia-Pacific market, the group's revenue in the first quarter may decline by 10%, and sales of its largest core brand, Gucci, are expected to plummet by 20%. On the day of the announcement, the company's stock price fell by more than 14%, marking the largest single-day decline since 1992.

In addition to Canada Goose, in recent months, companies like Nike have also announced large-scale layoffs. Nike has announced a $2 billion cost-cutting plan, which includes a 2% global workforce reduction.