Kering’s Q1 Revenue Drops 14% Amid Challenging Market
Kering’s first-quarter 2025 revenues fell 14% to €3.88 billion, with performance weighed heavily by another sharp drop at Gucci, which posted a 25% decline in comparable sales. The Italian house, which contributed 63% of the group’s operating profit in 2024, continues to face headwinds, with traffic remaining sluggish in both retail and wholesale channels.
The results trail those of Kering’s luxury peers. LVMH reported a 3% dip in Q1 sales earlier this month, while Hermès defied the slowdown with a 7.2% increase. Kering’s figures slightly underperformed Barclays’ forecast of a 12% drop, and mark a continuation of the slump seen in Q4 2024, when the group also reported a double-digit decline.
Regionally, the Asia-Pacific market fell 25%, consistent with prior quarters. Western Europe and North America both declined by 13%, while Japan saw an 11% contraction—signaling a broad-based cooling in demand across key markets.
Within Kering’s portfolio, Bottega Veneta stood out with a 4% increase in sales across all product categories. Kering Eyewear also saw modest growth at 3%. However, Saint Laurent dropped 9%, and the group’s “Other Houses” segment—which includes Balenciaga, McQueen, Pomellato, and Brioni—fell 11%. Notably, while Balenciaga’s leather goods were called out as a strong performer, McQueen continues to adjust to its new creative direction under Seán McGirr.
Kering’s chairman and CEO François-Henri Pinault acknowledged the tough quarter, stating, “As we had anticipated, Kering faced a difficult start to the year.” He reiterated the group’s commitment to executing strategic plans and strengthening brand positioning despite macroeconomic challenges.
The results come as the group bets on a new chapter at Gucci, with Demna—known for his provocative work at Balenciaga—set to take over as creative director. His appointment follows the departure of Sabato De Sarno in February after a muted two-year tenure. While Demna’s arrival has been met with mixed reactions from investors, Kering reported a “promising launch” of Gucci’s Softbit bag line and noted efforts to refresh its product offering ahead of his debut.
Kering is expected to address further details during its upcoming earnings call, including updates on market conditions in China and potential impacts of U.S. tariffs. While the luxury market faces a period of recalibration, the group is banking on bold creative leadership to help steer its flagship brand—and overall business—into recovery.