Kering Forecasts Sales Drop Amid Gucci's Struggles in Asia

The luxury conglomerate anticipates a 10% decline in Q1 sales, with Gucci's revenue expected to fall by nearly 20%, particularly due to weaker demand in China.

Kering, the owner of luxury brands including Gucci, issues a rare profit warning, forecasting a 10% drop in sales for Q1 2024.
Gucci's sales are expected to decline by nearly 20% in the first quarter, with a notable slump in the Asia-Pacific region, particularly in China.
The downturn at Gucci is attributed to a decline in demand among younger consumers and a lack of resonance with Gucci's legacy products.
New creative director Sabato De Sarno's collections, introduced in mid-February, have received a favorable reception, but it's too early to gauge their impact on sales.
The luxury sector faces a slowdown, with diverging fortunes among brands; Gucci's challenges contrast with the double-digit growth of rivals like LVMH and Hermes.