Kering Sales Miss Forecasts Amid Luxury Industry Slowdown
24 Ottobre 2023 - 6:19PM
Dow Jones News
By Mauro Orru
Kering posted sales below analysts' expectations for the third
quarter, becoming the latest fashion group to reel from a slowdown
in the luxury-goods industry as the postpandemic boom fades.
The owner of Gucci and Yves Saint Laurent on Tuesday reported
revenue of 4.46 billion euros ($4.76 billion) in the three months
to the end of September, down 13% in reported terms and 9% on a
comparable scope and exchange-rate basis. Analysts had forecast
sales of EUR4.52 billion, according to FactSet.
After years of strong results fueled by a surge in demand for
luxury goods, the industry is grappling with slowing sales globally
as customers reckon with inflation and high interest rates. China's
economic woes added to the wider slowdown. The country was the
world's largest luxury market before the pandemic. However, China's
economy has been suffering from a prolonged downturn in the
property sector as well as weak exports and consumer demand.
Gucci sales slipped 7% on a comparable scope and exchange rate
basis to EUR2.22 billion. Yves Saint Laurent recorded a 12%
contraction to EUR768 million, while Bottega Veneta sales fell 7%
to EUR381 million. Sales in Kering's other houses, including
Balenciaga and Alexander McQueen, dropped 15% to EUR805
million.
Analysts polled by FactSet had projected sales of EUR2.22
billion at Gucci, EUR799.5 million at Yves Saint Laurent, EUR390
million at Bottega Veneta and EUR822.5 million at other houses.
"Beyond the challenging macroeconomic conditions and softening
demand across the luxury industry, the change in our revenue
performance in the third quarter reflects the impact of our
decisions to further elevate our brands and their distribution,"
said Chief Executive Francois-Henri Pinault.
Earlier this year, Gucci appointed Sabato De Sarno as its new
creative director, seeking to reinvigorate the Italian brand and,
in July, Kering announced the departure of Gucci's CEO Marco
Bizzarri as part of a broader management shuffle, with
Jean-Francois Palusstepping in on an interim basis.
During the quarter, De Sarno unveiled his debut collection for
Gucci, which still accounts for the lion's share of Kering's
sales.
"The organization we put in place in July will enable us to
strengthen the steering of our houses in the current market
environment and to reclaim our positions and influence," Pinault
said.
Write to Mauro Orru at mauro.orru@wsj.com
(END) Dow Jones Newswires
October 24, 2023 12:04 ET (16:04 GMT)
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