Puma Boss Plans 900 Job Cuts, Better Marketing in Revamp

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(Bloomberg) — Puma SE plans to slash 900 more jobs and sharpen its focus on running, football and training as the German brand looks to rebound from its slump.

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New Chief Executive Officer Arthur Hoeld is revamping marketing efforts to make sure the sneaker maker is creating more compelling stories about products as they’re being developed, in hopes of making the brand more desirable for consumers, according to a statement Thursday.

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Puma’s goal is to return to growth by 2027 and establish itself as a top three sports brand globally by growing faster than the industry and having “healthy profits” in the medium term, it said. The job cuts announced Thursday are in addition to 500 already made, and will bring the total reductions by the end of next year to about 20% of Puma’s white-collar staff.

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The shares fell as much as 3.1% in early Frankfurt trading. Puma’s stock is down by more than 50% this year, far worse than the performance of rivals Nike Inc. and Adidas AG.

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Hoeld arrived at his plans after four months of meetings with staff, retailers, investors and partners about the best way to position the 77-year-old brand. In recent years, Puma has struggled to resonate with consumers and has lost ground to bigger competitors like Adidas and up-and-coming brands like On Holding AG and Hoka in the increasingly competitive landscape for sports gear and casual fashion. 

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Puma reported third-quarter sales and profits on Thursday that missed analysts’ estimates, in part weighed down by the effects of currency movements. That reduced sales in euro terms by about €125 million ($145 million), it said. The company reiterated its forecast from July, when Hoeld slashed Puma’s financial targets and said that 2026 will be a transition year.  

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The results are a “mixed bag, with ongoing reset initiatives clearly underway and in the heavy lifting phase,” Piral Dadhania, an analyst at RBC Capital Markets, said in a note. “However we still lack detail on the strategic pathway and priorities.”

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Puma’s new plan also entails boosting its direct-to-consumer sales efforts so that it’s more in line with industry norms and pulling back from some wholesale business that Hoeld regards as being of “low distribution quality.” In the past, the company has “become too commercial,” stimying efforts to raise Puma’s brand heat, it said. 

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In the US and Canada, for example, Puma is considering retooling its partnership with United Legwear that’s focused on the sale of socks and bodywear. Puma has a 51% stake in the joint company, but it’s now considering turning that into a licensing model this year to “optimize” its distribution network, it said. 

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Beyond that, Puma is looking to cut the overall size of its product range and reduce the number of new articles it introduces every year. 

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Puma will focus more on creating innovative products for football, running and training and make sure that its lifestyle products are clearly “rooted in and inspired by sports,” it said.

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The company is creating a new marketing approach in which teams will create campaigns and branding efforts on products as they’re being developed, Puma said. That was one factor behind Hoeld’s decision earlier this week to expand the role of Maria Valdes from chief product officer to chief brand officer.

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The poor performance of Puma shares has touched off speculation about the future ownership structure of the company. 

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The billionaire Pinault family, which owns a 29% stake, has reached out to potential buyers including Anta Sports Products Ltd. and Li Ning Co. to assess interest in buying Puma, Bloomberg News reported in August. The family has also sounded out other sportswear firms in the US, as well as sovereign wealth funds in the Middle East, according to people familiar with the matter.

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(Updates with shares, analyst comment, additional detail on job cuts)

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