Gucci’s sales in China decreased by 18% in the first quarter

Kaiyun Group announced its first quarter sales of 4.8 billion US dollars (4.5 billion euros), a year-on-year decrease of 10%, which is basically consistent with analysts’ expectations of 4.8 billion US dollars; However, the group expects its revenue to decline by 40% to 45% in the first six months of this year.

About half of Kaiyun Group’s sales and over two-thirds of its profits come from Gucci, but due to the economic downturn in the Asia Pacific region, the Italian fashion company’s revenue decreased by 18% to $2.2 billion (2.1 billion euros).

35% of Kaiyun Group’s sales come from Asia outside of Japan (although Japan is a barometer of demand in the Chinese market), this French luxury goods giant is facing a market downturn in China as consumers reduce their purchases of Gucci’s iconic belts and handbags.

In recent years, Gucci has undergone a major reform, including adapting to the fashion trend of “quiet luxury” – which is in stark contrast to Gucci’s long-standing image of extreme complexity. In 2022, a new creative director was appointed, followed by a new CEO in 2023.

LVMH, the French luxury goods group behind Louis Vuitton, is the biggest competitor of Kaiyun Group. The company owned by Bernard Arnault announced last week that its first quarter sales increased by 3%.

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