Kering reported organic growth for the first time in three years on Tuesday, with group sales rising 2 percent in the second quarter of 2026. The modest but symbolically significant uptick was driven largely by Gucci, which remained in negative territory but declined less than analysts had projected.
Kering’s performance stands in contrast to LVMH, which reported a 1 percent rise in fashion sales earlier in the results cycle, and Hermès, which continues to outpace the sector with high-teens growth. The gap underscores how Kering’s heavy reliance on Gucci—which generates roughly half of group revenue—remains both its strength and its vulnerability.
Gucci’s second-quarter sales contracted by 4 percent like-for-like, a marked improvement over the double-digit declines that have plagued the house since the post-pandemic demand normalization. Analysts had expected a steeper drop of around 6 percent, making the beat a relative victory for CEO Francesca Bellettini and creative director Demna.
The broader Kering portfolio showed mixed results. Saint Laurent and Bottega Veneta both posted low-single-digit growth, helped by resilient demand for their core leather goods categories. Balenciaga continued its recovery trajectory in the Asia-Pacific region, though European markets remained subdued.
Management struck a cautiously optimistic tone in the earnings call, citing early positive signals from the recent GuCCI collections and improved traffic in flagship stores. However, the luxury demand environment remains uneven, particularly in China where consumer confidence has yet to fully rebound.
The results provide a tentative signal that Kering’s turnaround efforts may be gaining traction. The question now is whether the group can sustain this momentum into the second half of 2026, when comparisons become easier but macro headwinds—including potential US tariff escalation—loom larger.
