The Business of Fashion
Agenda-setting intelligence, analysis and advice for the global fashion community.
Agenda-setting intelligence, analysis and advice for the global fashion community.
PARIS, France — French luxury conglomerate Kering posted a better-than-expected revenue rise in third quarter revenue on Tuesday, thanks to another strong performance from Gucci even as sales growth at the thriving brand comes off recent highs.
Kering, which owns other fashion labels including Saint Laurent and Balenciaga, said revenue reached €3.4 billion ($3.90 billion) in the July to September period and increased 27.5 percent on a comparable basis.
Sales growth had been expected to slow more sharply from 31.5 percent a quarter earlier to the 22.5 percent rise forecast in a poll of analysts by Inquiry Financial.
Luxury companies have been prey to investors' jitters over any potential slowdown in China, their single biggest market, and Kering has been in the spotlight over when appetite for Gucci handbags and other wares will start cooling following a hit makeover.
By Sarah White; editor: Sudip Kar-Gupta.
Hermes saw Chinese buyers snap up its luxury products as the Kelly bag maker showed its resilience amid a broader slowdown in demand for the sector.
The group’s flagship Prada brand grew more slowly but remained resilient in the face of a sector-wide slowdown, with retail sales up 7 percent.
The guidance was issued as the French group released first-quarter sales that confirmed forecasts for a slowdown. Weak demand in China and poor performance at flagship Gucci are weighing on the group.
Consumers face less, not more, choice if handbag brands can't scale up to compete with LVMH, argues Andrea Felsted.