Luxury slump catches up with Gucci and Bottega Veneta owner Kering
Kering, the owner of YSL, Bottega Veneta, Gucci and more, has revealed it has been hit by the luxury slowdown. The group’s revenue for the third quarter of 2024 totalled £3.17 billion (€3.8 billion), down by 15% on a reported basis.
The group revealed its sales from the directly operated retail network were down 17% on a comparable basis, blaming lower store traffic as the reason.
Geographically, sales were also affected by the Asia-Pacific and Japanese regions, which suffered a significant slowdown. In contrast, in North America and Western Europe, the group saw increased demand.
Wholesale and other revenue was down 12% on a comparable basis.
Brand breakdown:
Gucci: Revenue amounted to £1.3 billion (€1.6 billion), down by 26%.
Yves Saint Laurent: Revenue amounted to £558 million (€670 million), down by 13%.
Bottega Veneta: Revenue amounted to £330 million (€397 million) in the third quarter, up by 4%.
Other Houses: Revenue amounted to £571 million (€686 million) in the third quarter, down by 15%.
Kering Eyewear and Corporate: Revenue amounted to £366 million (€440 million), up by 32% as reported.
François-Henri Pinault, Chairman and Chief Executive Officer, said: “With discipline and determination, we are executing a far-reaching transformation of the Group, and at Gucci in particular, at a time when the whole luxury sector faces unfavourable market conditions.
“This severely impacts our performances in the short term. Our absolute priority is to build the conditions for a return to sound, sustainable growth, while further tightening control over our costs and the selectivity of our investments. We have the right strategy, organisation, and talents to achieve these goals.”
Looking ahead, Kering aims to “maintain a trajectory of long-term profitable growth and to confirm its status as one of the most influential groups in the Luxury industry”.
Following the larger-than-expected slowdown in the third quarter of the year, Kering expects its recurring operating income in 2024 to total approximately £2 billion (€2.5 billion).
