Diageo CEO Sir Dave Lewis Orders Deep Job Cuts

Six months was all Sir Dave Lewis needed to decide Diageo is carrying too many people. The new CEO has ordered his top team to pull headcount and costs at the maker of Guinness and Johnnie Walker, launching the deepest restructuring the spirits group has seen in years.

Each executive now has a cost-reduction target, according to the Financial Times, and the "non-revenue-generating" teams are set to take the heaviest hit.

The Financial Times describes a "funeral home atmosphere" inside Diageo's London headquarters, though the bleakness also marks a moment of setting a clear direction again.

Inside 'Drastic Dave's' playbook

Anyone who has watched Sir Dave work will recognise the method. Nicknamed "Drastic Dave" for the cost-cutting he ran at Tesco and Unilever, he has reached for the same scalpel at Diageo, drawing up the plans without a single consultant in the room.

With organic net sales expected to fall 2% to 3% this year, dragged down by weakness in the US and China, a leaner Diageo is his fastest way to stop margins sliding with them.

The supply-demand gap, he says, is "both a source of significant regret, but it's also an opportunity for us".

"A lot of the time, cycles inside the business are not quick enough," Dave said during a February 2026 earnings call, pitching "a much more agile Diageo operating framework," as the goal. The new cuts sit on top of an existing US$625m savings programme.

An exodus at the top

Since Sir Dave arrived, the heads of Great Britain, North America and Africa have left or are leaving. Diageo's head of human resources has also gone, just as the company begins its biggest people upheaval in years.

A familiar face fills the gap. Diageo has poached Marc Woodward, Unilever's UK chief and a former Lewis colleague, to run its domestic business.

"We thank Marc for his contribution to Unilever and wish him every future success," Unilever says.

Losing an HR leader during a time when thousands of colleagues face uncertainty hands the most sensitive part of the restructuring to others and removes a senior advocate for staff.

The frontline, at least, is being protected. The cuts target office, marketing and support roles rather than the workers who distil, brew and ship the product, according to the Financial Times.

The mass-market gamble

Beyond the cuts, Sir Dave is steering Diageo away from the premiumisation that defined it. Spirits sales have slid for years as health-conscious drinkers pull back, and his answer is to chase cheaper mass-market drinks aimed at younger and more cost-conscious consumers.

In February he halved the dividend and said Diageo must invest more in affordable brands. This move sent shares down almost 13% in a day. Diageo's shares have fallen more than 60% from their 2022 peak. Even so, he refuses to be hurried into a fire sale.

"Diageo will make disposals if appropriate, but we will not sell brands cheaply," Sir Dave says.

Investors get the fuller plan at a Capital Markets Day on 6 August, by which point the first job losses will already have landed.