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Shares in Kering dipped 1 percent on Thursday, a day after the French luxury group reported a 14 percent decline in first-quarter revenues, and a 25 percent drop at its star brand Gucci.
Also on Thursday, at Kering’s annual shareholders’ meeting, chairman and chief executive officer François-Henri Pinault flashed a line chart showing how company’s shares have roughly halved in value over the past year.
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“It’s a significant drop, and I know how disappointed you are and what it means for you in financial terms. We’re obviously not satisfied at all — far from it,” he said toward the end of a 90-minute presentation by various Kering executives, including Marie-Claire Daveu, chief sustainability and institutional affairs officer.
Pinault allowed that anemic demand for luxury goods and weak consumer sentiment, particularly in Asia, weighed on Kering’s fortunes in 2024.
“But this decline primarily reflects our underperformance, particularly at Gucci, our leading brand,” he said. “And let me tell you that the entire team around me is fully mobilized to ensure that we return to the results we can legitimately claim.
“The international context is of course very turbulent, but that does not scare us. Our top priority is to turn around Gucci in a sustainable and profitable manner, in the interest of all our stakeholders, and first and foremost, you, our shareholders. This is the commitment I make to you today,” he added.
It was his turn to trumpet how much faith he has in Gucci’s new artistic director, Demna, who will pick up the reins at the ailing Italian megabrand in early July, after parading a final couture collection for Balenciaga, which he’s revved up with supersized tailoring, chunky sneakers, logo tracksuits and drop-shoulder hoodies since arriving at the French house in 2015.
“Demna is one of the most influential and talented designers of his generation,” Pinault said, while acknowledging that his appointment was looked on dimly by investors and luxury analysts.
He argued that Gucci’s new chapter under Demna “promises renewed energy, a strong cultural impact, and above all, a reaffirmed authority on fashion. Demna will deploy his creative talent within the framework of the house’s codes.”
Beyond Gucci, he said, “our ambition is clear: to lead the transformations of our brands and reaffirm our position in luxury, while remaining true to what makes us unique.”