PVH Corp., the parent company of popular brands such as Tommy Hilfiger and Calvin Klein, has unveiled its plans to reduce people costs at its global offices by approximately 10% by the end of 2023. This strategic move comes as part of PVH’s efforts to cut costs and allocate resources towards digital transformation, supply chain optimization, and consumer engagement.
In a regulatory filing, PVH stated that it aims to generate cost savings exceeding $100 million, net of investment. The company has already accounted for pretax costs of $20 million in 2022 to cover severance related to initial actions. Furthermore, PVH anticipates an additional $50 million in severance charges, primarily in the second quarter. These charges were not factored into its previous guidance.
According to the filing, “In the third quarter of 2023, the company expects to take additional actions under these plans for which severance costs cannot be estimated at this time.” PVH further noted that it plans to finalize the majority of these actions by the end of the third quarter of 2023.
PVH’s stock saw a 1% increase in premarket trading and has experienced a 23% gain year-to-date. In comparison, the S&P 500 index has grown by 15%.
PVH Corp. continues to prioritize optimizing its operations and investing in digital infrastructure while implementing strategic cost reduction measures.