According to Forbes, German sportswear giant Puma is cutting 900 corporate jobs worldwide by the end of 2026, expanding a restructuring effort that had already eliminated 500 positions earlier this year. The company, led by CEO Arne Hoeld who took the helm in April, faces significant challenges including a projected annual loss—the first in more than a decade—and a stock price that has fallen by more than half in 2025, leaving its market capitalization below $4.5 billion. Sales declined 10.4% to $2.13 billion in the third quarter, with Puma struggling particularly in the U.S. market where it has faced shelf space reductions and heavy discounting. The company expects to return to growth by 2027 after completing its restructuring and distribution realignment, while focusing on higher-margin channels and reducing exposure to lower-tier wholesale partners. This dramatic restructuring reflects the broader challenges facing established sportswear brands in an increasingly fragmented market.
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The End of Wholesale Dominance
Puma’s struggles highlight a fundamental structural shift in the sportswear industry that goes beyond temporary market conditions. For decades, the business model relied on massive wholesale distribution through sporting goods retailers and department stores. This approach worked when there were limited channels to reach consumers, but the digital revolution has permanently altered the landscape. The company’s attempt to rebalance toward direct sales through its own e-commerce platform and flagship stores comes with significant infrastructure costs and marketing investments that have weighed heavily on margins during the transition period.
How Niche Players Are Winning
The success of brands like Gymshark, On, and Hoka demonstrates a critical market evolution that Puma and other legacy brands underestimated. These niche market specialists have mastered community-building and digital storytelling in ways that mass-market brands struggle to replicate. While Puma has historical strength in soccer and motorsport, these newer competitors have created intensely loyal followings around specific activities and lifestyles. The Gymshark partnership with Dick’s Sporting Goods represents a particularly troubling development for Puma—it’s not just that new brands are emerging, but that retail partners are actively choosing to feature them over established players.
Puma’s Brand Identity Challenge
With over 77 years of history, Puma faces what I’ve observed across multiple legacy brands: the curse of being good at many things but great at few. The company’s historical strengths in soccer (through partnerships with players like Pelé and Maradona) and motorsport (through Formula 1 partnerships) haven’t translated into clear brand positioning in the current market. Consumers today gravitate toward brands with authentic stories and specialized expertise, and Puma’s broad approach has left it vulnerable to specialists who dominate specific categories. The sneaker market in particular has become hyper-segmented, with different brands dominating performance running, lifestyle fashion, and technical innovation.
The Dangers of Deep Cost-Cutting
While the job cuts and cost reduction program announced through Puma’s investor relations channels may improve short-term financial metrics, they carry significant strategic risks. Corporate positions being eliminated often include marketing, innovation, and product development roles that are crucial for long-term brand building. The timing is particularly concerning given Puma’s commitment to “long-term brand investments over short-term sales pushes”—it’s challenging to invest in brand building while simultaneously cutting the teams responsible for executing those initiatives. History shows that brands that cut too deeply often emerge from restructuring smaller and less relevant, even if temporarily more profitable.
The New Athleticwear Hierarchy
The traditional “big three” hierarchy of Nike, Adidas, and Puma has fundamentally fractured. We’re now seeing a multi-tier market structure with Nike and Adidas maintaining scale advantages but facing their own challenges, while a second tier of specialized players captures high-margin segments. Puma finds itself caught between these groups—too large to be nimble like the niche players, but without the marketing firepower and distribution scale of the market leaders. The company’s goal to become a “top three sports brand globally” reflects an outdated view of the market structure that no longer exists in practice.
Realistic Recovery Timeline
Puma’s projection of returning to growth by 2027 appears optimistic given the scale of transformation required. The company isn’t just cutting costs—it needs to fundamentally redefine its brand identity, rebuild its product pipeline, and restructure its distribution network simultaneously. The inventory problem (up 17.3% year-on-year to roughly $2.3 billion) indicates deeper issues with product-market fit that can’t be solved through distribution changes alone. Success will require more than operational efficiency—it demands a cultural transformation toward innovation and brand building that typically takes established companies 3-5 years to achieve, if they succeed at all.
