Kering has reported an 11% decline in sales for the first half of 2024, impacting all its major brands.
- Gucci experienced a significant 18% drop in revenue during the same period, with a 19% decrease noted in the second quarter alone.
- Challenges in the Asia-Pacific market and reduced store traffic have further compounded Kering’s financial performance.
- Despite the downturns, select brands like Bottega Veneta showed positive retail growth, highlighting varied brand performances within Kering.
- Kering remains committed to strategic investments aimed at long-term value amid the current market challenges.
The luxury conglomerate Kering announced an 11% sales decline in the first half of 2024, a stark reflection of the prevailing economic challenges affecting high-end fashion brands. As the parent company of renowned names such as Gucci, Saint Laurent, and Alexander McQueen, the group’s revenue reached €9 billion, a drop from previous figures, with the second quarter contributing €4.5 billion to that sum, marking a consistent trend in decreased earnings.
Gucci, one of Kering’s flagship brands, witnessed an 18% decline in revenue compared to the same period the previous year. This downturn extended into the second quarter, where sales further diminished by 19%. In particular, the brand’s directly operated retail network suffered a notable 20% reduction, underscoring the broader retail challenges faced by Kering.
A deeper analysis of Kering’s performance across regions reveals that results remained consistent with prior quarterly outcomes. However, a significant decline was observed in Asia-Pacific, impacting overall financial metrics alongside diminished in-store traffic.
Despite these broad challenges, Bottega Veneta defied the trend with an 8% increase in sales through its directly operated retail network, though it faced a 19% fall in wholesale revenue. Such mixed performances across Kering’s portfolio highlight the heterogeneous impact of market dynamics.
Kering’s CEO, François-Henri Pinault, emphasised the company’s strategic focus on preparing for a return to growth. He highlighted ongoing investments to enhance offerings, improve communication effectiveness, and maintain exclusivity in distribution, aiming to ensure long-term value creation despite the pressing market conditions.
Kering’s financial results reflect a broader market downturn, but strategic investments aim to position its brands for future recovery.
