Gucci's Struggles: Kering's Revenue Slumps Unexpectedly

Kering reported a significant decline in first-quarter revenue, affected by underperformance at its star brand, Gucci. The group's revenue fell by 14%, surpassing analyst expectations of a 9.7% drop. Gucci's sales, contributing half of the group's revenue, dropped by 25%, failing to meet forecasted figures.

Kering announced on Wednesday a more substantial-than-anticipated decline in first-quarter revenue, reflecting ongoing challenges within the luxury group as Gucci, its leading brand, continues to underperform in a challenging market.

The Paris-based luxury conglomerate reported group revenue amounting to 3.88 billion euros ($4.40 billion) for the first quarter, marking a 14% organic year-on-year decline, surpassing the 9.7% drop forecasted by analysts according to a Visible Alpha consensus cited by HSBC.

Sales at Gucci, the iconic Italian fashion house that generates roughly half of Kering's total revenue, plummeted by 25%, notably underperforming against analyst expectations of a 19% decline, according to the group's statement. ($1 = 0.8811 euros)

(With inputs from agencies.)