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Gucci, an icon of luxury, in low hours. The flagship brand of the French conglomerate Kering closed the first half of the year with a slump in turnover: sales fell by 26% to just over €3 billion, dragging down the French group as a whole, which closed the period with a 16% drop in turnover and a 39% reduction in recurring operating profit.
According to information released today by Kering, Gucci’s sales in the first half of the year were down 25% on a like-for-like basis, dragged down mainly by the poor performance of the wholesale channel, with a 42% drop in sales. In direct distribution, Gucci sales fell by 24% from January to June. In total, Gucci closed the first half of the year with a turnover of €3,027 million, compared to €4,085 million in the same period of 2024.
Gucci’s operating margin was 20.4%, down 1.6 points. Recurring operating income was €486 million, down 52% compared to the first half of the previous year.
Yves Saint Laurent, the conglomerate’s second-largest brand, also worsened its performance in the first half, albeit at a more moderate pace. The brand’s sales came in at €1,288 million, down 11%, while recurring operating income fell 17% to €272 million.
Only Bottega Veneta avoided the falls up to June with a 1% increase in sales
Bottega Veneta is the only major Kering brand to avoid declines in sales. Sales through June were up 1% to €1,459 million, and operating income improved 5% to €127 million.
Kering’s other brands posted combined sales of €1,092 million, down 15%, and operating losses of €29 million, compared with a profit of €44 million in the first half of 2023.
The group’s total turnover as of June 30 stood at €7,587 million and operating income at €969 million, in both cases with declines similar to those recorded in the first quarter of the year: up to March, the group reduced sales by 14%, while Gucci’s turnover fell by 24%.
The direct distribution channel accounted for 73% of the group’s sales up to June, including ecommerce and Kering’s 1,772 own stores (41 net closures in the last fiscal year), while the wholesale, eyewear and beauty and royalties and others channels accounted for the remaining 27%.
In retail, Kering’s sales were down in all of the company’s most important markets: in Asia-Pacific, the decline was 22%; in Japan, 20%; in Western Europe, 15%; and in North America, 11%. At the end of the first half, Asia-Pacific accounted for 29% of Kering’s sales (three points less than in the first half of 2024), as did Western Europe (where the weight was up one point), followed by 24% in North America (up one point) and 8% in Japan.
The group has changed the creative direction of Gucci and has put an executive from the automotive industry, Luca de Meo, at the head of the group
The company has experienced a period of major changes in the first half of the year that has not yet yielded results in the income statement. On the one hand, Kering announced in March the appointment of Georgian designer Demna as its new creative director, leaving behind his career at Balenciaga. A month later, in June, Kering announced an unprecedented move in the luxury sector with the appointment of Luca de Meo, who came from the automotive sector, as the new CEO.
This year alone, the group expects 80 net store closures and a continued focus on renegotiation, downsizing and restructuring to optimize operating costs. Indebtedness is under control for the time being: the group ended the first half of the year with a net debt of €9,503 million, compared to more than €10,500 million at the end of the 2024 financial year.
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