Gucci Faces 25% Sales Decline Amidst Market Challenges
In the first quarter of 2025, Gucci, the flagship brand of French luxury conglomerate Kering, reported a significant 25% drop in comparable sales, contributing to a 14% overall decline in Kering’s revenue to €3.9 billion. 
This downturn is attributed to weakened demand in key markets, including a 25% decrease in Asia-Pacific and a 13% drop in both North America and Western Europe. 
Compounding these challenges are concerns over potential U.S. tariffs on European luxury goods, as proposed by President Trump. Analysts warn that such tariffs, ranging from 10% to 20%, could further dampen sales, particularly affecting brands like Gucci that cater to aspirational consumers. 
In response, Kering has initiated strategic changes, including appointing Demna Gvasalia, former Balenciaga creative director, to lead Gucci’s creative direction. However, analysts express skepticism about the effectiveness of these measures in reversing the brand’s fortunes in the near term. 
With Gucci accounting for half of Kering’s sales and two-thirds of its profits, the brand’s performance is critical to the group’s overall health. The current challenges underscore the volatility of the luxury market and the impact of global economic and political factors on consumer behavior.