Comparable retail sales fell 9 percent at constant exchange rates for the 13 weeks ending December 26, British luxury brand Burberry said in a statement Wednesday. Analysts had been expecting a 7 percent decline, according to a note from Bernstein.
The steep decline during the pivotal holiday quarter shows how the coronavirus pandemic has continued to weigh on luxury fashion brands, whose sales rely on a mix of economic optimism, spendthrift travellers, and social occasions that merit dressing up.
The pandemic has also widened the gap between the strongest players like LVMH and Hermès, whose fashion sales returned to growth by the end of last summer, and more novel propositions like Burberry, which overhauled its designs and weeded out diffusion lines in a bid to move upmarket under designer Riccardo Tisci and chief executive Marco Gobbetti.
Burberry pointed to a silver lining in the form of full-price sales that increased by more than 10 percent in its key leather and outerwear categories. The brand blamed low tourist traffic at its off-price outlets and an effort to limit markdowns in its mainline stores for the overall sales decline.