Despite a 4.3% revenue drop, the brand is investing in global expansion, new talent, and a fresh product pipeline
Chanel reported a 4.3% drop in annual revenues to $18.7 billion for 2023, its first decline since 2020. Operating profit fell 30% to $4.5 billion, a shift the brand attributes to global macroeconomic pressures and strategic investment.
“This performance followed a period of unprecedented growth in which revenues nearly doubled over the previous three years,” said CEO Leena Nair. “It’s a challenging time in the world… and it continues to be challenging.”
Chanel maintained record capital expenditures of $1.8 billion, opening 48 new boutiques—primarily fragrance and beauty—and six fashion stores, including two in underpenetrated China. The company also increased marketing spend to $2.4 billion, hosting events like its Métiers d’Art show in Hangzhou.
While overall sales dipped, beauty, ready-to-wear, and fine jewelry grew. Fragrance performed well with Margot Robbie fronting the No.5 relaunch and a new “Chance Eau Splendide” flanker. Coco Crush jewelry continued to thrive.
Leather goods—a core profit driver—likely led the downturn. After years of aggressive pricing, Chanel moderated increases in 2023, with just a 3% rise. “We intend to maintain more or less the same policy, which is to monitor our prices in line with global inflation in 2025,” said CFO Philippe Blondiaux.
The brand is now focused on revitalizing accessories and design under Matthieu Blazy, who will show his first collection this fall. “He’s one of the most talented and gifted designers in a generation,” said Nair. “We’re not focusing on what he’s going to bring to one collection, but looking at the next many collections over the next few years.”
Chanel is also entering new markets like India, where it opened a beauty store in Mumbai and partnered with Nykaa. “India is one of the most vibrant economies in the world,” Nair noted.
Despite short-term pressures, Chanel is playing the long game. “We’ve navigated many ebbs and flows in these 100 years,” Nair said. “We’re doubling down on what makes us uniquely Chanel.”