Gucci Falls 6% on a Comparable Basis as Kering Holds Q3 Revenue at €3.35 Billion

Kering reported third-quarter 2026 revenue of €3.35 billion, flat as reported and down 1% on a comparable basis. The reported figure includes a one-point positive currency effect, which is why the two measures differ. Nine-month revenue was €10.57 billion, down 2% as reported and stable on a comparable basis. Reuters gives the date of the trading update as Thursday, 22 October, while the company’s release is dated 23 October.

Group revenue was close to expectations. Investing.com cites a consensus of €3.34 billion. The weakness sat in Gucci, the group’s largest brand, which Chief Executive Luca de Meo has made the top priority. The share reaction was sharp. Reuters reports that Kering’s US-listed depositary receipts fell 11% after the update. Investing.com reports that Paris shares fell about 12% on Friday, 23 October.

Gucci’s Stores Weakened While Wholesale Rose

Gucci recorded €1.29 billion of revenue in the quarter, down 4% as reported. Adjusted for currency, the comparable decline is 6%. By calculation, that revenue is about 39% of group revenue for the quarter. Gucci sales fell as shoppers stayed away from its stores. Kering pointed to lower traffic in Asia Pacific, particularly mainland China, and in Japan. Reuters reports that Kering called footfall in China the main problem at Gucci.

Kering reports two channel lines: directly operated stores, which include e-commerce, and wholesale and other. Across the group, directly operated stores fell 3% on a comparable basis, while wholesale and other rose 3%. Gucci’s own stores fell 9%, while its wholesale business rose 45% from a low base, reaching €120 million. North America was the most resilient of Gucci’s markets, although Reuters says sales there slipped slightly. Reuters also notes that Gucci sales have fallen for more than three years.

Reuters also reports that Demna is nearing his first full year at Gucci. It says he moved production of his first sneaker models to China.

Store Closures
Kering now expects at least 125 net store closures in 2026, up from an initial target of 100, after closing a net 105 stores in the first nine months of the year.

Gucci’s Path Through the First Half

Gucci’s first-quarter revenue was down 8% at current exchange rates and 19% on a comparable basis, according to La Conceria. Kering’s second quarter, at €3.65 billion, was its first quarter of growth in three years, the same report says. Gucci’s second-quarter revenue was €1.41 billion, down 2% on a comparable basis, a smaller fall than the 4.7% decline analysts had expected.

Kering’s first-half revenue was €7.22 billion, down 3% at current exchange rates and up 1% on a comparable basis. Gucci’s first-half revenue was €2.76 billion, down 5% on a comparable basis. Bags and leather goods returned to growth at Gucci in the second quarter, helped by the new Borsetto and Paparazzo bags.

First-half net income was €189 million, down about 60% from the first half of 2025. Net debt fell to €3.3 billion, a reduction of €4.7 billion since December 31, 2025, which La Conceria attributes to the sale of the cosmetics division and real estate assets.

Shares on the Paris Stock Exchange rose by double digits after those results. Citi cited a credible recovery scenario and cost discipline as reasons for the rise. HSBC said it was optimistic about re-engaging aspirational customers, particularly for Gucci.

What de Meo Said and What the Plan Still Targets

De Meo said third-quarter revenue reflected the phasing the company had anticipated, in a softer macroeconomic environment. He described the recovery of Gucci as the group’s defining priority. Kering’s update describes customer traffic as the main constraint across the group, while conversion, average prices and transaction values were generally supportive.

In July, de Meo expected third-quarter group sales to be broadly flat and said 2026 would end with growth, according to La Conceria. He said some Gucci products had been repositioned after the brand moved too far in certain categories. He is counting on new leather goods for spring 2027.

Kering confirmed its goal of improving recurring operating margin in 2026, while continuing to invest in brand desirability. Investing.com reports that analysts expect full-year revenue of €14.55 billion.

Reuters places the longer goal in a five-year plan that aims to double Kering’s profit margin, which stood at 11.1% in 2025, by the end of the decade. It says the plan runs through cost cuts, more store closures and supply-chain streamlining, and that Kering plans to increase spending on marketing and client experience. Reuters also names the Iran war, weak China demand and slowing US momentum as obstacles.

Jewelry, Eyewear and the Fashion and Leather Goods Houses

Kering Jewelry generated €239 million, up 11% on a comparable basis, led by Boucheron and Pomellato. Kering Eyewear reported €373 million, up 4% on a comparable basis. Together, the two lines brought in €612 million, about 18% of group revenue. That share is calculated from the reported totals. Corporate and Other reported €27 million, down 5%, mainly because rental income ended, while Ginori 1735 grew strongly.

Kering’s Fashion and Leather Goods division posted €2.74 billion, down 3% on a comparable basis. Excluding Gucci, retail sales in the division rose 2%, led by Saint Laurent, Bottega Veneta and Brioni.

Balenciaga’s ready-to-wear and shoes remained challenged, Investing.com reports. Kering’s update says Balenciaga and Alexander McQueen were still repositioning. Reuters says creative directors Anthony Vaccarello at Saint Laurent and Seán McGirr at Alexander McQueen left their posts this month. The company update describes both as having announced their departures in October.

Gucci’s own stores fell 9%, while its wholesale business rose 45% from a low base.

Store Closures Rise as Kering Revises Its Plan

Kering closed a net 105 stores in the first nine months of 2026, after 128 closures and 23 openings. Net closures are closures minus openings, which is why the net figure is smaller than the closure count. The company now expects at least 125 net closures for the full year, up from an initial target of 100.

Gucci and L’Oréal agreed a 50-year exclusive beauty licensing deal, expected to take effect in mid-2027. Leadership changes also include new chief executives at Bottega Veneta, Pomellato and DoDo, a new President of Kering Italia and a new General Secretary.

Share Fall and the Sector Read-Across

Reuters says Kering’s stock was down 8% from a year earlier, amid a wider sector downturn. Reuters and Investing.com both link the fall to Gucci’s sales and the outlook for its recovery.

Reuters says lower-than-expected quarterly sales at LVMH and Hermès added to investor concerns about Kering. No figures for either company are given, and no move in their shares has been confirmed.

Kering has named Gucci’s recovery its defining priority, and Reuters says the brand accounts for roughly half of group profit. In July, the shares rose after the first-half results. In October, they fell after the third-quarter update.