Gucci Owner Kering Logs Lower Sales, But Flags Improving Trends — Update

By Andrea Figueras

Kering reported lower sales at the start of the year but flagged improving trends, an encouraging sign for the Gucci owner as it prepares to unveil a new plan later this week aimed at reviving growth.

The Paris-based luxury giant on Tuesday posted first-quarter sales of 3.57 billion euros ($4.20 billion), down 6% from a year earlier in reported terms, but stable on a comparable scope and exchange-rate basis. Analysts had forecast sales of 3.59 billion euros, according to Visible Alpha.

Both measures of sales showed an improvement compared with last year's fourth quarter, helped by a particularly strong contribution from the company's new jewelry segment, a promising sign for Kering after several disappointing quarters.

The update comes ahead of the expected launch of the group's new strategy to inject new life into its core brands, particularly Gucci, and revive its appeal to customers. The company is set to disclose the plan on Thursday.

Like its sector rivals, Kering has faced over the last few years a widespread decline in spending on luxury goods, which has been especially harsh in China, where the company and its peers are highly exposed.

Yet, Kering has struggled more than some of its competitors as Gucci tended to focus on seasonal designs that targeted less-affluent shoppers, who are more likely to avoid excessive spending in a difficult economy.

In an effort to reposition the group and its brands, former Renault boss Luca de Meo took the reins as Kering's chief executive in September. Since then, he has taken steps to restructure the business.

"The first quarter of 2026 marked continued progress, as we executed with pace and focus," the CEO said. The group is working to boost growth and efficiency, while also making changes across beauty, jewelry and real estate that have reinforced the balance sheet, he added.

Gucci, the company's flagship label, booked quarterly sales of 1.35 billion euros, down 14% on year in reported terms, but better than the 16% decline it posted in the preceding quarter.

Coupled with its own challenges, Kering is also confronting a difficult environment, marked by geopolitical turmoil and the war in the Persian Gulf.

Earlier this week, sector bellwether LVMH booked weak sales for the first three months of the year, noting that the geopolitical and economic environment had been disrupted, particularly due to the conflict in the Middle East.

The sector, which has had to contend with trade disputes and a tough economic climate, is now dealing with the impact of the war in Iran, which analysts say will hit demand in the region as well as tourism spending from Middle Eastern shoppers in Europe.

Kering said it continued to monitor the situation in the Middle East. In the first quarter, retail revenue in the region, which represents around 5% of the overall result, declined 11%.

"While some areas experienced temporary disruptions, the total retail network is operational today," it said. "Beyond the localized impact, which we continue to monitor closely, the broader consideration going forward relates to potential impacts on global tourism trends and the macroeconomic backdrop."

Despite the uncertainty, the company said it continued to target a return to growth and an improvement in margins this year.

Write to Andrea Figueras at andrea.figueras@wsj.com

(END) Dow Jones Newswires

April 14, 2026 13:14 ET (17:14 GMT)