Roula Khalaf, Editor of the Financial Times, curates her top stories in a weekly newsletter called the Editor’s Digest, accessible for free.
In recent financial news, Kering, a renowned French luxury group, experienced a significant decline in sales during the first quarter, primarily due to ongoing difficulties at Gucci, its most prominent brand. This downturn highlights the challenges awaiting the brand’s newly appointed creative director.
Kering, which also includes luxury brands such as Saint Laurent and Bottega Veneta in its portfolio, recorded a 14 percent decrease in year-on-year sales for the first quarter, totaling €3.9 billion. This drop surpassed the decline anticipated by analysts from Citibank and Barclays, who had predicted year-on-year declines of 10 percent and 12 percent, respectively.
The overall sales decline was significantly influenced by a 25 percent decrease in comparable sales at Gucci. In an effort to address these challenges, Kering recently appointed Demna Gvasalia, previously the creative director at Balenciaga, as Gucci’s new creative director. Gucci’s sales diminished to €1.6 billion in the first quarter.
Kering, which is under the control of the billionaire Pinault family, has faced ongoing challenges in resolving the issues at Gucci for several years, despite making changes to the brand’s design and executive teams. Since 2021, the brand has been lagging behind luxury industry leaders LVMH and Hermès.
