Burberry’s CEO has resigned amidst challenging times, with a notable decrease in revenues and share prices.
- Jonathan Akeroyd steps down as CEO following a 22% decline in revenue for Q1 2024.
- Burberry’s share price dropped 16% after the announcement, hitting the lowest in 14 years.
- Industry analysts deemed the resignation unsurprising given the company’s financial struggles.
- Joshua Schulman, former Michael Kors CEO, has been appointed as Akeroyd’s successor.
Jonathan Akeroyd, who served as Burberry’s CEO for two years, has resigned following a 22% year-on-year decrease in revenue, falling to £458m for the 13 weeks ending 29 June. This challenging financial scenario was further highlighted when Burberry’s share prices plunged by 16%, marking their lowest point in 14 years.
Industry experts, like independent retail analyst Nick Bubb, viewed Akeroyd’s departure as anticipated, particularly following the company’s underperformance in the first quarter. Morningstar’s Jelena Sokolova echoed this sentiment, noting that the change in leadership was expected given the unsatisfactory results.
The timing of Akeroyd’s resignation, occurring just days before Burberry’s intended first-quarter results announcement, was strategic. According to Katie Haxton from Flint Hyde, this decision was likely intended to demonstrate that Burberry was taking definitive action to manage its financial challenges and stabilise market concerns.
Akeroyd’s strategy of price increases against a backdrop of a weak industry and brand momentum did not bode well for Burberry. In response, the company has appointed Joshua Schulman, an experienced executive with a history at Michael Kors and other major brands, as the new CEO.
Schulman’s extensive experience in fashion retail spans multiple notable companies, and his appointment includes a substantial compensation package, mirroring Akeroyd’s previous remuneration. His relocation from New York City to London underscores the significant role he is expected to play in Burberry’s turnaround.
Elena Kirioukhina, a retail consultant, highlighted Schulman’s vast knowledge of the fashion landscape, suggesting that his leadership could align Burberry with market needs. John Murphy of Natasha Zinko commended Schulman’s sales-focused approach, indicating optimism for Burberry’s future under his guidance.
However, the transition may not be limited to the CEO position. Questions remain about the role of chief creative officer Daniel Lee, whose impact on the company’s sales has been under scrutiny since his appointment 21 months ago. As Burberry navigates its financial and operational strategies, further executive changes could be anticipated.
The appointment of Joshua Schulman as CEO marks a pivotal point for Burberry as it attempts to realign its strategy amid financial challenges.
