A Gucci store in Chongqing, China.Cheng Xin/Getty ImagesGucci had a challenging third quarter partly due to its APAC slump, per Kering's latest earnings call.The Italian luxury brand's sales dropped 25% this quarter compared to the previous year.It's been trouble in paradise for luxury brands in China, which was once their reliable cash cow.Gucci just had a bad quarter, and Kering is attributing the lackluster performance to a slump in its Asia Pacific market.The Italian luxury brand saw a 25% drop in quarterly revenue as compared to a year before.Gucci's parent company, French luxury group Kering, reported $1.77 billion in sales in the third quarter of 2024, compared to $2.39 billion in the same period last year."Sales from the directly operated retail network were down 25% on a comparable basis, the House being particularly impacted by market conditions, especially in Asia-Pacific," Kering's press release on Wednesday said of Gucci.The Asia Pacific region, which accounted for about a third of Gucci's global revenue this quarter, was the major dampener on sales.According to a third-quarter revenue infographic by Kering, sales in the APAC region were down 38% compared to the previous year."With discipline and determination, we are executing a far-reaching transformation of the Group, and at Gucci in particular, at a time when the whole luxury sector faces unfavorable market conditions," the group's CEO, François-Henri Pinault, said in the release."This severely impacts our performances in the short term," he added.Kering's performance was weaker than analysts had predicted."Overall, we were expecting a challenging 3Q print, and some level of reduction in FY24E EBIT guidance, however the magnitude of earnings erosion in the short term is worse than expected," analysts at RBC said in a note seen by Reuters."Of course, the debate continues to center on Gucci.
Comment on Things aren't looking great at Gucci, and Kering says its APAC slump is to blame
abharade@insider.com (Aditi Bharade), Business Insider
Thu, 10/24/2024 - 12:22am
Comment On This Story
Welcome to Wopular
Wopular is an
online newspaper rack,
giving you a summary view of the top headlines from the top news sites.
Senh Duong (Founder)
Wopular,
MWB,
RottenTomatoes
MoviesWithButter : Our Sister Site
- "Expendables 4" Starts Shooting This Fall, Says Randy Couture at the Arnold Sports Festival more
- “Expendables 4” Gets Funding Interest from “Ip Man 3” Financier more
- "Ip Man 3" Distributor Suspected of Box Office Fraud, Parent Company Loses $200M in Market Cap more
- Yen Targets "Ip Man 4" for 2018 Release; Discusses Film with Director, Producer more
- "Ip Man 3" Shatters Expectations with $72M Opening [China Box Office] more