Kering’s third quarter could pivot on Gucci’s performance in China – Results snapshot


By Joshua Kirby

French Kering is expected to publish its revenue results for the third quarter on Tuesday after the market closes. Here’s what you need to know:

SALES FORECASTS: The luxury group is expected to achieve sales of 4.08 billion euros ($ 4.74 billion) for the quarter, according to a consensus of four analyst estimates compiled by FactSet.


-PRESSION IN CHINA: Headwinds in demand linked to pandemic-related store closings and travel restrictions in China over the summer could dampen regional sales. The group can however rejoice in the third quarter results of rival LVMH Moet Hennessy Louis Vuitton SE last week. The print suggested a positive exit rate in Asia, with potentially encouraging read-across for players exposed to China such as Kering, as well as Hermes International SCA and Moncler Spa, Citi said at the time.

– GUCCI MOMENTUM: Any contraction in demand in China will be bad news for Kering’s main brand, Gucci, which generates almost half of its sales in Asia. Gucci had started to rebound, resuming sales growth from the pre-pandemic period in 2Q, but like the broader industry, it’s likely there will be a sequential slowdown this time around. The brand is, moreover, particularly exposed to the recent political volatility in China linked to the policy of “Common Prosperity”, analysts at Jefferies said in a recent note. Indeed, the impact could be visible in the Q3 update, the bank said.

Write to Joshua Kirby at [email protected]; @joshualeokirby

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