Kering in freefall: what repercussions for the Paris luxury goods industry?

The Kering Group is going through a difficult period, with sales down -15% for the first half of 2025. This situation has a direct impact on the luxury ecosystem, particularly in Paris.

The turmoil continues for French luxury giant Kering. In the first six months of 2025, the Group posted sales of 7.6 billion euros, down -15% on the same period last year. Operating income recurring fell to 969 million euros (-39%), while net income plateaued at 474 million euros. A worrying situation in a context where the global luxury goods market is contracting.

In Paris, a city emblematic of luxury, this underperformance has a particular resonance. Many of the Group’s flagship brands – Gucci, Saint Laurent, Balenciaga and Boucheron – are located in the capital. An overall drop in business for these brands could mean less footfall in their Parisian stores, and potentially adjustments in staffing or local strategy.

Gucci, Kering’s weak link

The biggest concern is Gucci, whose sales plunged by -25% to 3 billion euros. In Paris, the Marais and Avenue Montaigne stores have not been spared. The collapse in sales in the directly-operated network(-24%) and in Wholesale(-42%) confirms the disaffection of key customers, notably Asian. The creative reorganization entrusted to Demna, ex-Artistic Director of Balenciaga, will have to convince rapidly.

Saint Laurent and Bottega: contrasting dynamics

Yves Saint Laurent, the Parisian pillar of the group with its HQ on rue de Bellechasse, saw a 10% drop in sales. The retention of Anthony Vaccarello as artistic director marks a desire for stability, despite the current mercato in the luxury goods industry. Bottega Veneta, on the other hand, posted a timid +2% growth, avoiding the general downturn. A sign that its discreet, timeless image still appeals to a demanding clientele.

What’s the outlook for the luxury capital?

The drop in sales in Western Europe (-17%) and Japan (-29% ) is due in particular to weaker tourist flows, as Kering points out. Paris, where luxury tourism is crucial, is therefore seeing its role as an international crossroads weakened. It remains to be seen whether the arrival of Luca de Meo as CEO will reverse this trend. His experience at Renault could bring a healthy dose of pragmatism to an industry that is currently on its last legs.

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