Global Spirits Giant Diageo to Cut 305 North American Jobs

In this photo illustration, Diageo logo seen on a smartphone and a pc screen in the background. (Photo by Pavlo Gonchar / SOPA Images/Sipa USA)(Sipa via AP Images)

Diageo is eliminating 305 jobs at its North American headquarters in New York as CEO Sir Dave Lewis moves forward with a major restructuring of the spirits giant.

The permanent layoffs are scheduled to take effect Sept. 30, according to a WARN notice filed by the company. Diageo cited economic reasons for the cuts.

The reductions come as Diageo works to reshape its business after a difficult year in North America, its largest regional market. The company said in August that it was redesigning its operating framework as part of a plan to make the business more competitive.

“We understand that this is a difficult time for colleagues, and we remain committed to supporting everyone through these changes,” a Diageo spokesperson said, according to Drinks Intel.

The cuts at the New York headquarters follow a sharp decline in Diageo’s North American business.

For the fiscal year that ended June 30, Diageo reported $19.64 billion in net sales, down 3% from the prior year. Organic net sales declined 2%.

North America accounted for 37% of the company’s sales, but organic net sales in the region fell 8.4%.

Lewis has previously pointed to North America as a focus of Diageo’s restructuring efforts. At an investor day last month, he said the region had been “underperforming for quite a while,” adding that strong tequila growth had masked some of those problems.

Diageo is targeting roughly $1 billion in savings over three years. About $850 million of that total is expected to come from redesigning the company’s operating framework.

Lewis has said the company needs to “right-size the business” after investing ahead of growth. He also indicated that many of the changes would affect corporate functions such as finance, technology and human resources rather than sales and marketing.

The 305 New York positions are the latest in a broader reduction of Diageo’s global workforce.

The company ended its latest fiscal year with 27,938 full-time equivalent employees, down from 29,860 a year earlier. That represents a reduction of 1,922 positions, or about 6.4%, according to Diageo’s annual report.

Diageo employed 30,367 full-time equivalent workers in fiscal 2024.

The largest regional decline over the past year came in Africa, where average headcount fell from 2,848 to 1,920.

The company has not indicated that the New York layoffs represent the end of the restructuring. With the majority of its planned savings still tied to changes in its operating structure, additional workforce and organizational changes could follow as Lewis attempts to reverse Diageo’s recent performance.