Kering has reported a double-digit downturn in revenues for the first half of 2025, dragged down by a dismal performance from its flagship fashion label Gucci.
The French luxury fashion house's revenues sank 16% to €7.6bn as it took a nearly €1bn hit from Gucci, as well as lacklustre sales from other brands such as Yves Saint Laurent.
This was offset slightly by Kering Beauté, the conglomerate’s beauty arm, which bucked the downturn in income as first-half revenues rose 9% to €150m.
For the second quarter in particular, sales soared 12% on a comparable basis, driven by a strong performance of Creed's women’s fragrances.
It follows a similar pattern from Q1, when the group’s beauty business again offered a silver lining to an overall decline in revenues.
“On the operational and financial fronts, in a particularly tough market environment, we continued to streamline our distribution and cost base, and, executing on our roadmap, we took decisive steps to strengthen our financial structure,” said François-Henri Pinault, Chairman and CEO of Kering.
“Though the numbers we are reporting remain well below our potential, we are certain that our comprehensive efforts of the past two years have set healthy foundations for the next stages in Kering’s development.”
Sales from the directly operated retail network fell by 16% on a comparable basis in Q2, in line with the performance of the first quarter of 2025, according to Kering.
The group’s performance in North America and Asia-Pacific improved slightly over Q1, but was still down 10% and 19% respectively for the second quarter of trading.
Western Europe and Japan fared worse, reporting respective declines of 17% and 29%, as a sharp decline in tourism impacted demand.
The sales decline follows Kering undertaking a significant change in its executive leadership, naming Luca de Meo its new CEO in June.
This is subject to shareholder approval at a meeting scheduled for 9 September, with de Meo set to join on 15 September.
The move followed a proposal from the Board of Directors, chaired by Pinault, who will retain his role as Chairman.
“The first half of 2025 has been a period of momentous decisions for Kering,” Pinault added in his statement on the company’s half-year 2025 results.
“On the governance front, I recommended to the board of directors, which has agreed, that we entrust the role of Kering CEO to Luca de Meo, while I will retain the chairmanship.
“On the creative front, reinforced teams, headed by new designers at three of our largest houses, are hard at work, with passion and determination, intensifying the desirability and drawing on the heritage of all our brands.”
Kering has been doubling down on its beauty division over the past year, having issued a €750m single-tranche bond in May 2025 to enhance its financial flexibility.
The French conglomerate established its beauty division in 2023.
This was to develop the beauty arms of its Bottega Veneta, Balenciaga, Alexander McQueen, Pomellato and Qeelin houses.
It acquired luxury fragrance house Creed in June that year for a reported US$3.8bn.
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