Gucci in a nosedive. In the first quarter of 2024 its revenues will “fall by almost 20%”. This was announced by Kering, the group that owns the Florentine fashion label, in a press release reporting preliminary information for the first fiscal quarter of 2024. The French luxury giant estimates to close it with a 10% drop, compared to the same period in 2023. And it discloses that “the positive contribution from the consolidation of Creed and the negative impact on foreign exchange” will affect revenues between -1 and -2%.
Kering’s warning
Non-positive figures were expected from the luxury sector, given the deep crisis that the Italian production chain is going through. A crisis that, we now know, has scaled to the tip of the iceberg. Kering issued a press release that has the taste of a real alert and estimates an overall decrease in its turnover of around 10% on a comparable basis of its consolidated revenues in the first quarter of 2024 compared to 2023. “Kering expected it would be challenging and current trends” lead it to predict a double-digit drop in revenue.
Gucci down by “almost 20%”
“This performance mainly reflects a steeper decline in Gucci’s sales, particularly in the Asia-Pacific region. Gucci’s comparable revenues in the first quarter are expected to decline by almost 20% year-on-year”. The double-G label accounts for 50% of Kering’s revenues. This suggests that the group’s other designer labels (e.g. Saint Laurent, Bottega Veneta, and Balenciaga) as well as the businesses defined as “Eyewear and Corporate” have performed well, offsetting Gucci’s nosedive.
Some hope
“The first products, mainly ready-to-wear, of the Ancora collection”, concludes the Kering note, “have been on sale in selected Gucci stores since mid-February. This new collection, the availability of which will gradually increase over the coming months, is meeting with a very favourable reception”. The French giant will publish its Q1 2024 earnings on 23 April.
Read also:
