Ferragamo for 16.6% of sales. The luxury crisis strikes everywhere
The luxury crisis, which started from the East, seems unstoppable. Revenues at Italian luxury group Salvatore Ferragamo fell 16.6% at constant exchange rates in the first quarter, with China proving difficult and a general slowdown in sales across all geographies and channels . It seems clear that a change in consumer tastes is underway which is penalizing luxury.
“During the quarter, our performance was impacted by continued volatility in the Chinese market, as well as persistent weakness in wholesale and travel retail, further exacerbated by an unfavorable comparison,” CEO Marco Gobbetti said in a statement on Thursday.
Revenues amounted to 227 million euros in the first three months of the year, below the expectations of analysts who had expected 237 million euros according to the LSEG consensus.
In April, sales in the direct-to-consumer channel were slightly negative, but the trend is improving, Gobbetti said on a conference call with analysts, adding that revenues in the February-April period for that channel were substantially dishes.
However, the CEO, who said he wants to prioritize top-line performance, doesn't see a deterioration in gross margin.
“We are seeing difficult demand in China, customers are quite worried about the macroeconomic situation,” he said, adding that sales performance in March and April in Greater China was quite negative overall.
Gobbetti added that, on a positive note, the trend of direct-to-consumer sales in Europe is improving.
At the same time, however, a crisis in luxury consumption has been affecting China and the related markets of Hong Kong and Macao for some months now. The significant drop in sales has already been felt in the luxury watch sector and , apparently, also in the entire remaining high-value goods sector. Evidently the growth of the Chinese middle and wealthy class is not unlimited and has reached a ceiling.
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The Ferragamo item for 16.6% of sales. The luxury crisis hits everywhere comes from Economic Scenarios .
This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/ferragamo-per-il-166-delle-vendite-la-crisi-del-lusso-colpisce-ovunque/ on Fri, 10 May 2024 07:00:06 +0000.