Kering’s Q3 Sales Slide Amid Luxury Sales Slowdown

Post by **PinkDiamond** » Fri Oct 27, 2023 6:54 pm

We all expected a slow down in luxury buying once the pandemic ended and other opportunities for spending became available again such as travel, so the results we're seeing now likely just took a bit longer to manifest themselves in the downturn of profits we've been seeing for the past 2 quarters, but with the holidays upon us I think they'll still do well for the year overall. We'll just have to wait for the results at the end of the year to see if I'm right or not.

The rose and white gold “Triennale” ring from Pomellato is set with a diamond and a tanzanite. Pomellato is one of the three jewelry brands Kering owns.

"Paris—The recent slowdown in spending on luxury goods hit Kering in the third quarter, though the three jewelry brands owned by the luxury conglomerate seemed to hold their own.

On Tuesday, the company reported a 13 percent decline in sales (9 percent on a comparable basis) to €4.46 billion ($4.72 billion).

Wholesale sales (down 20 percent on a comp basis) fell more sharply than revenue from the stores Kering operates directly (down 6 percent).

The company said it saw a decline in foot traffic in its stores in Q3. It also has been tightening control over its wholesale distribution.

Year-to-date, Kering’s sales have totaled €14.6 billion ($15.43 billion), down from €15.07 billion ($15.94 billion) at this time last year, a 3 percent decline.

“Other Houses,” the Kering division that includes its jewelry brands as well as fashion brands Balenciaga, Alexander McQueen and Brioni, posted the largest quarterly decline of any of the company’s divisions.

Sales fell 19 percent (15 percent on a comp basis), though the luxury conglomerate had only positive comments about its three jewelry brands, Boucheron, Pomellato, and Qeelin.

It said Boucheron had a “positive performance” due to both its high jewelry and regular jewelry collections while Pomellato achieved “solid growth” in stores and Qeelin “showed excellent momentum.”

Kering’s other brands, Gucci, Yves Saint Laurent and Bottega Veneta, also posted third-quarter sales declines.

Gucci’s sales fell 14 percent (7 percent on a comp basis), YSL’s sales were down 16 percent (12 percent on a comp basis), and revenue for Bottega Veneta declined 13 percent (7 percent on a comp basis).

Kering Chairman and CEO François-Henri Pinault said challenging macroeconomic conditions and a decrease in demand for luxury goods impacted the company’s Q3 performance.

He also mentioned the changes the company made beginning in July to “reclaim our positions and influence” as a contributing factor.

These include appointing Jean-François Palus as president and CEO of Gucci; buying a 30 percent stake in ... "
https://nationaljeweler.com/articles/12 ... s-slowdown