Kering announced on Wednesday that its first-quarter 2025 revenue reached 3.9 billion euros, approximately $4.4 billion, marking a 14 per cent drop from the previous year.
The company experienced a 16 per cent comparable decrease in directly operated retail sales across all regions during this period. Aligning with its fourth-quarter pledge to evaluate its retail footprint and close underperforming locations, Kering shut down 25 stores in the first quarter.
Gucci, Kering’s largest brand, saw its revenue for the quarter fall to $1.816 billion, a 24 per cent year-over-year decline. Comparable figures revealed a 25 per cent decrease in retail sales revenue and a 33 per cent drop in wholesale revenue. The company attributed Gucci’s retail decline to weak store traffic.
Tang, an analyst at Third Bridge, an investment research firm, indicated that sales and profitability are anticipated to remain pressured as the brand grapples with creative direction and a lack of product innovation. She pointed out that Gucci lacks compelling new products to draw consumers back to stores, with its leather goods continuing to disappoint. Tang further suggested that Gucci’s performance is likely to stay weak throughout 2025.
Kering Chairman and CEO François-Henri Pinault recognized that the company encountered a difficult, yet anticipated, start to the year.
In the announcement, he stressed that the group remains dedicated to executing its strategic and financial plans to strengthen the market position of its brands. Pinault added that the company is increasing its focus to navigate ongoing macroeconomic challenges and expressed optimism about emerging stronger from the current situation.
