KUALA LUMPUR, French luxury group Kering SA, the parent company of Gucci, reported third-quarter sales that fell less than expected, offering a glimmer of optimism as newly appointed chief executive officer Luca de Meo begins his turnaround efforts.
The group’s revenue declined 5% on a comparable basis, outperforming analysts’ forecasts of an 8.7% drop, Kering said on Wednesday. Its flagship label Gucci recorded a 14% decline in sales — still a contraction, but narrower than market projections — while Yves Saint Laurent and Bottega Veneta both delivered stronger-than-expected results.
A Gucci store on Via Monte Napoleone, in Milan. Gucci owner Kering SA reported better-than-expected sales.
Despite Gucci’s continued struggle amid the broader luxury slowdown, investor sentiment toward Kering has improved, with shares rising nearly 30% this year. Confidence in De Meo’s leadership has been bolstered by his swift strategic moves, including the recent €4 billion (RM19.63 billion) divestment of Kering’s beauty business to reduce debt and refocus resources on its core fashion brands.
“Kering’s performance remains well below market levels, but we are working relentlessly to drive a turnaround,” De Meo said in a statement.
Gucci — which contributes roughly half of Kering’s total profit — has been battling sluggish demand and creative challenges, leading to two designer changes in less than two years. However, there are signs of stabilisation, particularly in North America, where retail revenue returned to growth during the quarter.
Chief financial officer Armelle Poulou noted that sales in the region encompassing China, while still negative, showed improvement as Gucci’s new collections, such as the mini GG bag and the compact Giglio model, gained traction among consumers.
With De Meo now at the helm, investors and analysts will be watching closely for how Kering balances innovation, brand revitalisation, and operational discipline to restore Gucci’s leading position in the global luxury market.
