Levi’s to Discontinue Footwear Line

Levi Strauss & Co. is making a strategic move by exiting its footwear business as part of its Project Fuel productivity plan. The denim giant incurred $116 million in severance and other charges in the first quarter as it focuses on pivoting towards more direct-to-consumer business.

Michelle Gass, the company’s president and CEO, stated that they are “deprioritizing and ultimately exiting” the footwear business in Europe, which never reached significant scale. However, Levi’s is not shying away from collaborations, with successful partnerships like Crocs and New Balance.

New Balance recently released a collaboration with Levi’s, featuring the classic MT508 sneaker silhouette inspired by mountain biking culture and adorned with the iconic Levi’s red tab. While Levi’s is stepping away from shoes, they are expanding their apparel offerings to include head-to-toe denim looks, tops, and non-denim active styles.

The shift towards direct-to-consumer business seems to be paying off for Levi’s, with a 7 percent increase in revenues in the first quarter. Despite a decline in wholesale sales, investors responded positively to the news, sending shares of the company up by 6.3 percent in afterhours trading.

As part of Project Fuel, Levi’s plans to streamline its operations by cutting 10 to 15 percent of its corporate workforce, affecting 500 to 750 jobs. The company is confident that these strategic decisions will position them for future growth and success in the evolving retail landscape.