Kering Warns of Halved 2024 Profit, Appoints New Director

Kering, a French luxury goods group, announced that its 2024 operating profit could drop to roughly half of the previous year's level, primarily due to a significant sales decline at its flagship brand, Gucci. Gucci sales fell by 25% in the third quarter, exacerbated by weak demand in the Asia-Pacific region, particularly China, which is a major market for luxury goods. Overall group revenue for the third quarter was 3.79 billion euros, a 16% drop on an organic basis and below analysts' expectations. The decline in sales has led Kering to anticipate a recurring operating income of about 2.5 billion euros for 2024, significantly down from 4.75 billion euros in 2023. In response, Kering has appointed a new director general at Gucci and is undergoing a strategic overhaul to revitalize the brand, aiming for sustainable growth amidst challenging market conditions. Other brands under Kering, like Yves Saint Laurent and Balenciaga, also experienced sales slumps, while Bottega Veneta reported a slight increase.