Kering Revenue Down 10% in First Quarter Amid Market Slowdown
Kering reported a revenue decline of 11% as reported and 10% on a comparable basis for the first quarter of 2024, totaling €4.5 billion. The drop was attributed to challenging market conditions and strategic brand repositioning.
Kering, the luxury goods conglomerate, experienced a significant revenue decrease in the first quarter of 2024. The Group's revenue fell 11% as reported to €4.5 billion, and 10% on a comparable basis. This downturn reflects a normalization in the luxury sector, sluggish market conditions particularly in China, and strategic transitions within its houses, notably Gucci.
François-Henri Pinault, Chairman and CEO, described the performance as a considerable worsening, anticipating a sharply lower operating profit for the first half of the year. He cited the impact of prevailing market conditions and the ongoing repositioning efforts as exacerbating downward pressures on sales.
Gucci, a key brand for Kering, saw its revenue drop by 18% on a comparable basis, reaching €2.1 billion. Yves Saint Laurent and Bottega Veneta also reported declines, though less pronounced. However, other houses within the group, including Balenciaga, Brioni, and Boucheron, demonstrated resilience or growth in specific areas.
The Kering Eyewear and Corporate segment, bolstered by the full consolidation of Creed fragrances, reported a 9% increase in comparable revenue. This segment includes Kering Eyewear, which also saw growth.
Looking ahead, Kering reaffirmed its commitment to investing in its brands' desirability and distribution exclusivity. The company aims to navigate the uncertain economic environment by reinforcing creative innovation and long-term appeal, targeting sustained profitable growth in the luxury market.