Kering, the luxury conglomerate that owns brands such as Gucci and Balenciaga, has noted a sequential improvement in its revenue for the first quarter, indicating that the company’s recovery is gaining momentum.
The company reported a revenue of €3.568 billion (US$4.2 billion) for the quarter that concluded on March 31. This figure represents a 6% decline year-on-year on a reported basis, but remained steady on a comparable basis.
The fashion and leather goods segment, however, witnessed a 9% reduction in sales as per reports, and a 3% drop on a comparable basis. Brands like Saint Laurent, Bottega Veneta, Balenciaga, and Brioni showcased year-on-year growth during the quarter, with North America emerging as a significant influencer of this positive trend.
Gucci, one of Kering’s prime assets, saw a 14% dip in revenue on a reported basis, and an 8% decrease on a comparable basis. Despite a promising 8% increase in North America, declining trends in Asia-Pacific (Apac) and Western Europe overshadowed its performance.
On the other hand, Kering’s jewelry section reported a 14% increase in sales on a reported basis and a 22% surge on a comparable basis. This rise was attributed to strong performance across key regions, with Japan and Apac leading the demand.
Kering Eyewear also experienced growth, with a 3% increase in sales on a reported basis and a 7% increase on a comparable basis.
Kering’s CEO, Luca de Meo, highlighted that the stabilizing revenue signals an essential first step towards the group’s recovery. He further added, “Nearly all our Houses delivered growth during the quarter, with a particularly strong contribution from jewelry. Gucci remains our top priority. A comprehensive turnaround is underway, with decisive actions across client, distribution, and, above all, the offer.”
The luxury group acknowledged the ongoing conflict in the Middle East as an area of ‘heightened attention.’ The region, with around 1100 employees and 79 stores, accounts for approximately 5% of total retail revenue. The first quarter saw an 11% decline in retail revenue in the region, following growth in the initial two months. Despite temporary disruptions in some areas, the entire retail network is currently operational, as per the company’s statement.
What was the overall revenue of Kering for the first quarter?
The overall revenue for the first quarter was €3.568 billion (US$4.2 billion).
Which brand under Kering saw significant growth in this quarter?
The brands Saint Laurent, Bottega Veneta, Balenciaga, and Brioni reported year-on-year growth in the quarter.
How has the conflict in the Middle East affected Kering’s retail revenue in the region?
There was an 11% decline in retail revenue in the Middle East in the first quarter.
