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  • Prada Group Net Revenues Reach €4,541 Million in First Nine Months

    Prada Group Net Revenues Reach €4,541 Million in First Nine Months

    Prada Group generated net revenues of €4,541 million in the first nine months of 2026, advancing 15 percent at constant exchange rates as recent consolidation masked a sharp deceleration across core retail markets.

    Excluding the newly consolidated Versace business, organic net revenue increased 4 percent year on year, while total retail sales reached €3,934 million across the nine-month period.

    Wholesale sales contributed €428 million, climbing 17 percent organically, while royalties reached €178 million, up 16 percent on an organic basis. Group retail sales across all brands rose 11 percent at constant currencies, but stripped of the Versace acquisition, organic retail growth was held to 2 percent. For the third quarter alone, organic retail revenues showed zero growth year on year.

    The Hong Kong-listed luxury house recorded a split performance across its commercial divisions. The flagship Prada brand generated retail sales of 2,414 million euros, up 2 percent organically across the nine months and 1 percent in the third quarter. Miu Miu booked retail sales of 1,156 million euros, managing a 1 percent organic increase over nine months before slipping 3 percent in the third quarter. Newly integrated Versace added 322 million euros in retail turnover, while Church’s generated 23 million euros, up 3 percent organically.

    Asia Retail Momentum Slows

    Asia Pacific remains Prada’s largest regional market by volume, delivering 1,344 million euros in retail sales during the first nine months. Reported growth hit 12 percent at constant exchange rates, but organic growth came in at 5 percent over nine months and ground to a complete halt at 0 percent during the third quarter.

    Japan produced 424 million euros in retail revenue, representing 2 percent organic growth over nine months and flat performance in the third quarter, following the reallocation of Hawaiian operations to the Americas division. In Europe, retail sales reached 1,180 million euros, contracting 3 percent organically both over nine months and throughout the third quarter. The Americas proved more resilient, contributing 851 million euros on 13 percent organic growth over nine months and 5 percent in the third quarter. Middle Eastern retail sales dropped 23 percent organically to 136 million euros.

    Chief Executive Officer Andrea Guerra pointed to shifting consumer sentiment across key luxury corridors.

    “The third quarter unfolded against a particularly challenging industry backdrop. In this context, the Group showed good resilience, underpinned by brand desirability and strong retail execution.”

    Cost Pressures Squeeze Half-Year Margins

    The nine-month trading slowdown follows compressed profitability recorded during the first half of the year. In the first half of 2026, net revenues stood at 3,048 million euros, but operating expenses rose to 1,858 million euros, consuming 60.9 percent of turnover compared to 57.5 percent in the prior-year period.

    Selling costs climbed to 1,242 million euros in the first half, while advertising and promotion outlays grew to 307 million euros, or 10.1 percent of revenue. Adjusted earnings before interest and taxes dropped to 530 million euros from 619 million euros, lowering the adjusted operating margin from 22.6 percent to 17.4 percent. Group net income for the half contracted to 327 million euros from 386 million euros.

    Chairman Patrizio Bertelli noted that market turbulence is likely to persist across the luxury sector, requiring agility and strict execution.

    Regional Exposure and Strategic Trade-Offs

    For store operators and commercial landlords across Asia, the stalled third-quarter organic retail figures confirm that the spending boom among regional consumers has reached an exhaustion point. Prada avoided outright regional contraction only through the top-line addition of Versace assets, a buffer that independent luxury peers lacking recent acquisitions do not possess.

    The risk now centers on whether promotional spending and real estate commitments in Asian gateway cities can yield sustainable returns as organic demand flattens. With Miu Miu turning negative in the third quarter, Prada cannot rely on secondary labels to offset slower traffic across primary flagship stores. Landlords negotiating lease renewals face a luxury tenant base that is defending operating margins rather than bidding up prime square footage.

    Milestones Across the Timeline

    Prada expanded its retail footprint and physical brand investments during 2026, opening the permanent Pradasphere exhibition inside Milan’s Galleria Vittorio Emanuele to anchor an eight-floor complex. Group marketing chief Lorenzo Bertelli projected the Milan space would add 100 million euros in annual revenues by driving visitor conversion.

    The group concluded its 2025 financial year on March 5, 2026, reporting full-year figures before convening its annual general meeting on April 30. First-quarter revenue updates were presented on the same day, followed by half-year financial statements released on July 30.

    Investors now await Prada Group’s full-year 2026 financial report, where balance sheet use tied to the Versace deal and year-end inventory levels across Asia will face direct scrutiny.

  • Luxury Goods Market to Reach $610.4 Billion by 2032 as Asia-Pacific Leads Growth

    Luxury Goods Market to Reach $610.4 Billion by 2032 as Asia-Pacific Leads Growth

    Asia-Pacific luxury goods spending will expand at a compound annual rate of 5.2 percent between 2027 and 2032, outpacing every other global region as total market value heads toward USD 610.4 billion.

    Europe retained 51.82 percent of worldwide luxury turnover in 2026, but Asian demand is shifting the commercial priorities of major European fashion conglomerates. Global luxury sales stood at USD 484.2 billion in 2026, climbing to USD 505.1 billion in 2027. While mature Western markets cope with cautious shoppers, regional retail networks across China, Japan, and Southeast Asia are taking a larger share of capital expenditure.

    Clothing and apparel anchored the sector with a 36.93 percent market share in 2026. Hard luxury, led by specialist watchmakers, is projected to deliver the quickest category expansion at 4.2 percent through 2032. Women drove 55.93 percent of total luxury revenue in 2026, though menswear is advancing at a 4.25 percent annual rate. Single-brand boutiques controlled 38.16 percent of retail sales in 2026, but dedicated online channels are forecast to expand at 4.75 percent annually through 2032.

    Prada and Hermès Expand Regional Footprints

    Prada Group generated a 15 percent jump in Asia-Pacific retail sales during the first half of 2026 compared with the first half of 2025. Stripping out the acquisition of Versace, organic regional retail turnover grew 6 percent at constant exchange rates. The flagship Prada label maintained positive momentum through the second quarter, while Miu Miu recorded steady volume gains across the half.

    Rival Hermès logged EUR 4.53 billion, or USD 5.11 billion, in 2025 revenue from its combined ready-to-wear and accessories division, a 6 percent gain at constant currency. Leather goods and saddlery sales rose 13 percent, supported by added workshop capacity. Chanel followed a parallel path by opening more than 40 standalone boutiques in 2025, directing a substantial portion of those doors into Mainland China, Japan, and the Middle East.

    Compagnie Financière Richemont saw its specialist watchmaker division post an 8 percent revenue gain at constant exchange rates in the three months to June 2026, led by sales in Japan and the Americas. The group’s jewellery division, housing Cartier and Van Cleef & Arpels, generated a 14 percent sales increase during the fiscal year ended March 31, 2026.

    Direct Store Ownership Shifts Margin Control

    The operational divide between company-owned flagships and third-party wholesale accounts is hardening across Asian shopping districts. LVMH Moët Hennessy Louis Vuitton operated approximately 2,300 dedicated fashion and leather goods boutiques worldwide at the close of 2025. Direct store ownership shields retail margins from intermediary markdowns and maintains rigid presentation standards in premier Asian malls.

    Wholesale distribution carries severe legal boundaries when brands attempt to dictate shelf pricing. The European Commission fined Kering’s Gucci, Richemont’s Chloé, and Loewe in October 2025 for illegal resale-price restrictions imposed on independent distributors across Europe. Those distribution curbs ran until April 2023, barring stockists from discounting apparel, shoes, and leather goods. Luxury houses operating in Asia face a clear operational tradeoff: independent retail partners deliver fast geographic distribution, but houses sacrifice pricing authority over the final consumer ticket.

    Digital channels are simultaneously consolidating around high-spending clients rather than broad web traffic. Online platform Mytheresa increased net sales by 11.5 percent at constant exchange rates in fiscal 2026, while expanding its top-tier customer base by 18 percent during the fourth quarter. Direct consumer relationships allow brands to defend price points without depending on wholesale clearance mechanisms.

    Regulatory Pressures and Supply Checks Tighten

    Supply chain scrutiny is forcing luxury groups to alter how they produce and verify garments sold in Asian commercial hubs. LVMH instituted supplier audits, work-in-progress monitoring, and on-site factory visits in 2025 following public scrutiny over labor practices within Italian manufacturing hubs. Across its operations, recycled materials reached 41 percent of product and packaging inputs in 2025, including circular cashmere projects at Loro Piana.

    Apparel importers into Mainland China face tightened quality-safety rules and mandatory merchant inspections under standard GB 18401-2010, alongside expanded fiber measures starting July 1, 2026. Chinese authorities require sellers to inspect incoming inventory and store compliance documentation for at least two years. The regulatory duty contrasts with the United States, where the Federal Trade Commission permits invoice-level fiber disclosures without requiring dedicated per-unit verification checks.

    Anti-counterfeit enforcement remains a constant operational friction point for Asian distribution networks. The European Anti-Fraud Office concluded an enforcement operation in May 2025 that netted 1.8 million counterfeit garments, footwear pieces, and leather accessories hidden within legitimate textile shipments. Illicit goods mixed into lawful trade flows drain brand equity while complicating customs clearance for verified fashion houses.

    Divergence Across Global Spending Hubs

    The acceleration of luxury demand in Asia contrasts sharply with contractions in the Middle East. Military operations involving the United States, Israel, and Iran in early 2026 reduced the Gulf luxury consumer base by 15 to 25 percent. Richemont saw sales in the Middle East and Africa slide 3 percent at constant currency during the quarter ended March 31, 2026, hurt by suppressed tourist traffic and cautious domestic spending.

    Consumer demand is dividing by income tier. A survey of aspirational luxury clients conducted across 11 key markets in 2026 revealed that every respondent classified as an infrequent, price-sensitive buyer planned to trim personal spending over the subsequent 12 months. An additional 22 percent of regular luxury shoppers planned to reduce transaction ticket sizes, trading down within product collections.

    Luxury brands are directing product development toward ultra-affluent shoppers who remain insulated from inflationary pressures. Global personal wealth grew 10.8 percent in dollar terms during 2025, adding 440,000 millionaires in the United States alone. Capturing these shoppers requires extensive boutique investments in prime metropolitan locations rather than broad distribution through department store counters.

    The next test for luxury retail performance arrives on July 19, 2026, when the European Union’s statutory ban on destroying unsold garments and footwear takes effect for large corporations, directly reshaping how fashion houses clear seasonal stock across their international supply chains.

  • Prada Holds Organic Revenue Growth at 1% as China Foot Traffic Softens

    Prada Holds Organic Revenue Growth at 1% as China Foot Traffic Softens

    Prada reported a 1 per cent rise in third-quarter organic revenue, keeping group sales steady despite footfall drying up across shopping centres in mainland China.

    Total group revenue reached €1.49 billion including newly acquired Versace, matching analyst consensus estimates compiled by Visible Alpha.

    Organic calculations exclude Versace, which Prada purchased in December last year. Management reported that the integration of the fashion house remains on track ahead of the runway debut of Pieter Mulier, the label’s incoming creative director, scheduled for next year.

    Mainland Footfall Drags on Asia-Pacific Margins

    Sales across the Asia-Pacific territory held flat during the three months. Foot traffic in mainland Chinese luxury malls remained subdued, forcing the group to rely on gains in secondary Asian markets to keep regional top-line figures level.

    The stagnation in greater China tests the regional retail model. Landlords have leaned heavily on premium fashion houses to anchor luxury malls, yet conversion rates are slipping as aspirational consumers pull back.

    Luxury brands face an unforgiving margin squeeze when foot traffic drops in Chinese flagship units. High retail rents and store operations negotiated during peak post-lockdown trading now run against lower volumes, leaving operators to depend on high-net-worth VIP clients rather than walk-in demand.

    Miu Miu Momentum Moderates

    Miu Miu recorded a slower pace of expansion in the third quarter after driving the bulk of Prada’s total organic revenue lift throughout 2025. The brand had previously outpaced the flagship label by wide margins, drawing younger consumers across East Asia with viral accessories and footwear lines.

    Outside Asia, trading patterns diverged sharply. North American operations delivered continued top-line gains, though at a milder pace than in the second quarter, while European sales remained weak.

    “The third quarter unfolded against a particularly challenging industry backdrop. In this context, the Group showed good resilience, underpinned by brand desirability and strong retail execution”, Chief Executive Andrea Guerra said in a statement.

    Integration Roadblocks and What to Watch

    Prada entered the current quarter after completing its takeover of Versace late last year, an acquisition aimed at building a multi-brand Italian conglomerate to counter French luxury groups. Absorbing that business while Asian demand cools raises operational risks across retail networks.

    Attention now shifts to the commercial reception of Pieter Mulier’s first Versace collection next year, which will show whether the enlarged group can generate wholesale and direct-to-consumer momentum outside the core Prada nameplate.

  • LVMH, Hermès and Kering Shares Fall up to 40% Since January

    LVMH, Hermès and Kering Shares Fall up to 40% Since January

    Over the past three years, the luxury retail sector has experienced a steady decline following a brief post-pandemic boom, with most major players reporting lower-than-ever sales figures.

    Since January, share prices of LVMH, Hermès and Kering have fallen 40 per cent, 39 per cent and 30 per cent, respectively, while Richemont remains roughly flat.

    Valuations tumble after pandemic highs

    The downturn reflects the Q3 performance of eight key luxury companies, including Burberry, Hermès, Kering, LVMH, Moncler, Prada and Richemont, as major luxury houses struggle with falling demand.

    Third-quarter earnings across eight key players, Burberry, Hermès, Kering, LVMH, Moncler, Prada and Richemont, show softer client appetite. Entry-level and aspirational buyers cut spending sharply. Top-tier jewelry and watch assets held their ground better than leather goods and fashion apparel.

    Richemont holds steady against fashion losses

    Richemont avoided the valuation collapse that hit French fashion and leather houses. Its share price traded roughly unchanged over the period. Steady demand for high jewelry and fine timepieces insulated the group.

    By contrast, fashion-heavy houses such as Kering and LVMH bore the brunt of reduced store traffic. Aspirational buyers drove volume growth for designer accessories and entry-level items during the post-pandemic rebound. They cut discretionary outlays as price hikes collided with tighter household budgets.

    Shift in aspirational demand across core markets

    Retail strategies face a reset after three years of contraction. Luxury groups spent the post-pandemic cycle raising prices on signature handbags and footwear. They wagered that brand equity would protect volume.

    That pricing strategy has hit resistance. Brands dependent on repeat purchases from middle-income aspirational consumers are seeing foot traffic slow. Operators and department store landlords must now adjust inventory intake and floor space allocations.

    Earnings filings show divided sector performance

    The retreat began three years ago when pandemic savings cushions unwound and international travel normalized. Quarterly reports from Paris and Milan have since shown sequential decelerations across core product divisions.

    Investors and retail operators now track upcoming full-year earnings from LVMH, Kering and Richemont. Those reports will show whether inventory adjustments and selective price freezes can stabilize revenue heading into the next fiscal cycle.

  • LVMH and Prada Shares Trade at Deep Discount to Zara and H&M

    LVMH and Prada Shares Trade at Deep Discount to Zara and H&M

    Shares in luxury powerhouses LVMH and Prada traded at an unusually deep valuation discount to fast-fashion retailers Zara and H&M in October 2026. Investors hesitated to buy the dip amid growing concern that the luxury sector’s strongest growth period has passed.

    The valuation gap marks a sharp reversal after trends that made high-end luxury groups a standout investment over the past 20 years began fading. Top fashion houses are increasingly exposed as demand cools across broader consumer segments, leaving them reliant on a narrow group of ultrawealthy spenders.

    Valuation gap widens

    Stock multiples for top luxury names historically commanded a heavy premium over mass apparel operators. That pricing power built on high gross margins, tight inventory control, and reliable price increases on leather goods and apparel.

    Equity markets have flipped that relationship. Fast-fashion groups Inditex, which owns Zara, and H&M now trade at higher comparative multiples than both Paris-listed LVMH and Hong Kong-listed Prada.

    Fast fashion takes market momentum

    Mass-market retailers have defended turnover by turning inventory quickly and adjusting collections within weeks. Zara and H&M adjusted prices more conservatively while capturing spend from middle-income households managing tighter budgets.

    Luxury brands took the opposite path over the last four years. Aggressive price increases on core handbags and accessories pushed aspirational shoppers out of the market entirely.

    Squeeze on aspirational spenders

    Department stores and flagship retail malls across Asia report softer footfall in premium corridors as middle-class consumers cut discretionary purchases. The pullback leaves luxury groups reliant on top-tier VIP clients who buy haute couture and high jewelry.

    That customer base is too narrow to sustain the double-digit revenue growth rates equity investors came to expect. Mall operators in major retail hubs are already reassessing space allocations as mass-market and sports labels post steadier sales densities.

    Earnings reports to watch

    The downturn follows consecutive years of record revenues across European luxury houses between 2021 and 2023. Those gains unraveled as post-lockdown shopping splurges faded and mainland consumer sentiment turned cautious.

    Market watchers are tracking upcoming third-quarter revenue updates from LVMH and quarterly trading figures from Prada to gauge whether holiday order books show any signs of stabilization.

  • K11 Musea First-Half Sales Jump 40 per Cent on Luxury Tenant Overhaul

    K11 Musea First-Half Sales Jump 40 per Cent on Luxury Tenant Overhaul

    Hong Kong retail complex K11 Musea increased first-half revenue by 40 per cent year-on-year, posting record sales for the period following a sweeping overhaul of its tenant roster.

    Newly introduced brands at the Tsim Sha Tsui waterfront destination averaged sales gains of more than 30 per cent, parent company New World Development said.

    The landlord initiated the first phase of its brand repositioning in the second half of 2024. That phase will wrap up by the end of this year, clearing space for flagship retail formats designed to generate higher revenue per square foot.

    Watches and Jewellery Drive Member Spending

    Hard luxury delivered the sharpest gains. Loyalty member spending on watches and jewellery climbed 80 per cent year-on-year during the first six months, while outlays on international luxury labels rose 20 per cent.

    Recent openings include boutiques from Miu Miu and IWC Schaffhausen, alongside a duplex flagship for Max Mara. Running label Hoka and Chinese outdoor brand Kailas also opened locations at the property over the summer.

    Tourist retail spend climbed 50 per cent year-on-year across the summer holiday period, supported by targeted arts and cultural exhibitions. Loyalty club spending continued that pace into August, rising 30 per cent.

    Landlords Shift Floor Plans to High-Yield Tenants

    Hong Kong shopping malls are aggressively reallocating square footage toward top-tier luxury labels and high-margin outdoor apparel to capture higher average basket sizes from mainland visitors. Rather than relying on volume foot traffic alone, operators are filtering tenants by direct sales productivity, a metric Horace Lam, chief executive of K11 Hong Kong, identified as the primary filter for new leases.

    Prada will open a new boutique at K11 Musea in the coming months, alongside an unannounced international yoga apparel brand scheduled to make its debut before the upgrade concludes.

  • Prada Embraces Indian Craftsmanship: Launches Authentic Kolhapuri Sandals to Mend Cultural Appropriation Rift

    Prada Embraces Indian Craftsmanship: Launches Authentic Kolhapuri Sandals to Mend Cultural Appropriation Rift

    Prada, the renowned Italian luxury brand, is set to debut a limited-edition collection of sandals crafted in India, bearing a keen resemblance to the traditional Indian Kolhapuri footwear. This initiative comes just months after the brand had to face a wave of criticism for showcasing similar designs without giving due credit to their Indian origins.

    Price Point & Controversy

    These exclusive pairs, each having a price tag of approximately 750 euros (US$881), are set to make a grand entrance into the luxury fashion platform. This initiative has its roots in a controversy that stirred up in June 2025. Prada was under fire for presenting sandals at a Milan fashion show which greatly resembled the traditional Indian Kolhapuri chappals. This led to an uproar among Indian artisans and political figures, who claimed this to be a case of cultural appropriation.

    In response, Prada acknowledged the inspiration drawn from the timeless Indian styles and disclosed that it had initiated discussions with artisan groups for potential collaboration.

    Production & Distribution

    In December, Prada revealed its plans to manufacture a total of 2000 pairs of these Indian-inspired sandals. This production will take place in the Indian states of Maharashtra and Karnataka, as part of agreements with two state-endorsed organizations. This collaboration aims to blend localized craftsmanship with innovative Italian technology.

    The brand announced that these sandals will be available for purchase in 40 carefully chosen Prada outlets around the globe, as well as online.

    Artisan Training Programme

    Moreover, Prada has initiated a three-year training programme specifically designed for artisans hailing from the eight districts in India traditionally associated with the crafting of Kolhapuri sandals. This programme, divided into six-month structured modules, will be delivered by two esteemed Indian design institutes. The objective is to enhance the skills of 180 artisans, with the first batch starting next month.

    In a statement, Tanu Kashyap, the director general at the National Institute of Fashion Technology, expressed her enthusiasm for the initiative, stating, “It is time that Indian traditional crafts take their rightful place on the world stage”.

    Additionally, these artisans will be given a chance to visit the Prada Group Academy in Italy to enhance their technical prowess further.

    Questions & Answers

    What was the controversy Prada faced in June 2025?
    Prada faced backlash for showcasing sandals at a Milan fashion show that resembled traditional Indian Kolhapuri chappals, without acknowledging their cultural origin.

    How is Prada merging traditional Indian craftsmanship with Italian technology?
    Prada plans to manufacture 2000 pairs of sandals in Maharashtra and Karnataka in India, in collaboration with local artisans and under agreements with two state-backed organizations.

    What is the three-year training programme initiated by Prada?
    Prada has kicked off a three-year training programme for artisans from eight districts in India traditionally associated with Kolhapuri sandal-making. Delivered by two leading Indian design institutes, the programme aims to enhance the skills of 180 artisans.

  • Prada Unveils Asia-Pacific’s Largest Store at Landmark Hong Kong: A New Era of Luxury Retail

    Prada Unveils Asia-Pacific’s Largest Store at Landmark Hong Kong: A New Era of Luxury Retail

    Prada, the iconic Italian fashion house, has inaugurated a new flagship boutique at Landmark Hong Kong. This development comes as a part of the brand’s ongoing mission to refine its tangible presence in the city and within the Landmark retail complex.

    Grand Opening

    Sprawling over an impressive 1300-square-meter expanse, the newly opened store arranged over three levels stands as the brand’s biggest outlet in the Asia-Pacific region. This prime location at the intersection of Des Voeux Road and Ice House Street boasts conspicuous street-facing windows and a striking off-white steel facade.

    The exterior design showcases Prada’s signature triangular motif and is adorned with a sophisticated Porto Bianco stone finish, enhancing the overall aesthetic appeal of the store.

    Inside The Flagship

    The store’s interior carries forward the quintessential Prada design elements that are seen in other boutiques worldwide. A tasteful combination of a black-and-white checkered marble floor, green wall finishes, and black metal detailing lends a luxurious and contemporary vibe to the space.

    The store’s first floor is dedicated to women’s ready-to-wear pieces, while the second floor primarily caters to menswear. A limited selection of women’s items can also be found on this floor. The ground floor offers an exclusive shopping experience with private rooms specifically designed for fine jewellery consultations and personalisation services.

    The Larger Retail Landscape

    Prada’s relocation is indicative of the persistent demand for large-format stores in premium locations among international luxury brands. This is in spite of the shifting tourism dynamics and changes in consumer spending patterns in Hong Kong’s retail market.

    Questions & Answers

    What does the new Prada store’s relocation signify?
    The move signifies the ongoing demand for large retail spaces in prime locations by international luxury brands, despite changes in consumer spending and tourism in Hong Kong.

    What are the distinguishing features of the new Prada store?
    The new store is characterized by its street-facing windows, an off-white steel facade featuring Prada’s triangular motif, and Porto Bianco stone finishes. The interior boasts a black-and-white checkered marble floor, green wall finishes, and black metal detailing.

    What does the layout of the new Prada flagship store look like?
    The 1300-square-meter store is spread over three levels. The first floor is dedicated to women’s ready-to-wear, the second floor primarily houses menswear along with some women’s items, and the ground floor includes private rooms for fine jewellery appointments and personalisation services.

  • Prada Group Posts 19th Consecutive Quarter Growth Amid Global Retail Challenges

    Prada Group Posts 19th Consecutive Quarter Growth Amid Global Retail Challenges

    The Prada Group has demonstrated sustained growth for the 19th straight quarter, even in the face of a complex global retail landscape. The financial results for the nine months leading up to September 30 reveal a promising overview.

    Financial Overview

    During this period, the luxury group’s net revenues climbed 9% year-on-year, reaching $4.7 billion. This growth was bolstered by a corresponding 9% rise in retail sales, which accounted for $4.2 billion. Despite a high base from the previous year, retail sales in the third quarter increased by 8%, mirroring the growth seen in the second quarter.

    Brand Performances

    Miu Miu, a brand under the Prada Group, has continued its strong performance. It reported a 41% growth over the nine months and a 29% increase in the third quarter. This comes after an impressive 105% surge during the same period the previous year.

    In contrast, sales for the Prada brand itself eased slightly. The third quarter saw a decrease of 1%, and a 2% drop was reported over the full nine months.

    Company Response

    Patrizio Bertelli, Chairman of Prada, viewed these results optimistically. He commented that the consistent performance, despite a challenging macroeconomic environment, “attests to the resilience of our brands and the effectiveness of our strategy.”

    Questions & Answers

    What was the overall growth for the Prada Group in the recent quarter?
    The Prada Group saw a 9% increase in net revenues year-on-year, reaching a total of $4.7 billion.

    How did the individual brands under the Prada Group perform?
    While Miu Miu saw significant growth with a 41% increase over nine months, the Prada brand experienced a slight decrease in sales, with a drop of 2% over the same period.

    What has the Chairman of Prada said about the company’s performance in this quarter?
    Chairman Patrizio Bertelli emphasized the consistent results despite a complex macroeconomic environment, attributing the success to the resilience of the brands and the effectiveness of their strategy.

  • Prada Sees 9% Revenue Boost, Credits Rising Star Miu Miu Amid Tough Luxury Market

    Prada Sees 9% Revenue Boost, Credits Rising Star Miu Miu Amid Tough Luxury Market

    Prada, a family-owned group known for its luxury fashion, recently reported a 9% spike in first-half net revenues at constant currencies. The company’s lesser-known yet rapidly growing Miu Miu brand played a significant role in this upswing, potentially signaling a positive shift in an otherwise sluggish sector.

    In terms of figures, Prada’s net revenue reached a substantial 2.74 billion euros ($3.16 billion), mirroring analysts’ expectations. This growth can be attributed to supportive performance across all regions.

    Brand Performances

    Despite the group’s overall success, the Prada brand experienced a 3.6% drop in retail sales in the second quarter. In contrast, the Miu Miu label saw a remarkable 40% increase in sales, accounting for a quarter of the group’s total revenues last year.

    Prada’s second quarter was adversely affected by reduced tourist influx into Europe and Japan, as well as unfavorable comparisons to last year’s performance. Company executives shared these insights during a conference call held after the results were announced.

    Andrea Guerra, the Chief Executive, informed analysts that he anticipates tourist traffic levels to rebound by the end of August.

    Management Changes

    In a noteworthy development, the Italian firm recently separated from Prada’s brand CEO, Gianfranco D’Attis. Guerra has temporarily assumed the additional responsibilities, with plans to retain them for an extended period. He stated, “If it is an interim (arrangement), it’s a long one.”

    Operating Profit and Future Acquisitions

    The group’s adjusted operating profit climbed 8% to 619 million euros in the first six months, falling slightly short of the 636 million euro operating EBIT projected by analysts.

    Prada Chairman Patrizio Bertelli commented on this solid performance, stating it was achieved amidst a challenging backdrop, somewhat unprecedented in our industry.

    In terms of upcoming developments, the group anticipates finalizing the acquisition of Versace from Capri Holdings between September and November this year.

    Luxury Industry Outlook

    Despite these positive developments for Prada, a robust recovery for the luxury industry remains uncertain. For instance, Gucci’s parent company, Kering, reported a 15% fall in quarterly revenues. Additionally, LVMH recorded a 4% drop in quarterly sales, and Hermes, despite a 9% sales surge, showed signs of being affected by the broader luxury downturn.

    Questions & Answers

    What accounted for Prada’s 9% increase in first-half net revenues?
    Prada’s growth in the first half was largely due to supportive performance across all regions and the exceptional growth of the Miu Miu brand.

    How has Prada’s management changed recently?
    Prada recently parted ways with its brand CEO, Gianfranco D’Attis. The company’s Chief Executive, Andrea Guerra, has taken on these additional responsibilities for the foreseeable future.

    What is the current outlook for the luxury industry?
    The luxury industry faces uncertain times. While some brands like Prada and Hermes have shown growth, others, such as Gucci and LVMH, have reported decreases in revenue. A robust recovery for the industry remains elusive.

  • Prada brings Versace home to create Italian luxury contender

    Prada brings Versace home to create Italian luxury contender

    Prada’s deal to buy Versace revives hopes for a ‘made in Italy’ luxury champion after many other family-founded brands ended up in French, Swiss or US hands, and comes as many Italian groups are outperforming the struggling sector.

    The US$1.375 billion deal brings one of fashion’s best-known Italian labels back under Italian control after it was sold to US-listed Capri Holdings, then known as Michael Kors, for $2.15 billion including debt in 2018.

    Despite Italy accounting for 50 per cent to 55 per cent of global personal luxury goods production, according to consultancy Bain’s estimates, the country lacks a group with a scale that matches up to French players such as LVMH and Gucci-owner Kering.

    Milan-based Prada, controlled by designer Miuccia Prada and husband Patrizio Bertelli and listed in Hong Kong with a market capitalisation of about $15 billion, is the largest Italian luxury fashion group by revenue.

    But the group, which also includes the fast-growing Miu Miu label, has been a relative minnow in terms of stock market valuation compared with the likes of Louis Vuitton-owner LVMH.

    The Versace deal comes after Andrea Guerra became Prada’s CEO in 2023 to bridge a change in generation, with Lorenzo Bertelli, the son of the company’s main owners and its chief marketing officer, regarded as the heir apparent.

    “Prada’s ambition to become a leading Italian luxury conglomerate is a significant move in a market that is dominated by French groups. It’s exactly what many Italians have been hoping for”, said Achim Berg, a fashion and luxury industry adviser.

    The combined revenue of the five biggest Italian-owned listed luxury groups – Prada, Moncler, Ermenegildo Zegna, Brunello Cucinelli and Ferragamo is still well below Kering’s roughly $19 billion, even after a big fall in sales at the French group last year.

    Company founder Brunello Cucinelli summed up the difference in approach on the two sides of the Alps in typically colourful fashion.

    “Our esteemed French counterparts are great financiers,” he told the Milano Fashion Global Summit 2024 last October.

    “But we Italians regard our ‘tiny big’ companies as if they were our little children, so we want to look after them and hand them down to a next generation,” he added.

    While LVMH and Kering have swallowed many Italian brands, even the larger Italian groups have until now been comparatively reluctant to make big acquisitions.

    “This acquisition represents Prada’s serious attempt to build a group – and a much more ambitious one compared to their past ventures with Helmut Lang and Jil Sander,” Berg said.

    Prada’s chairman and co-owner Patrizio Bertelli defined the acquisition of those two brands – which were bought at the turn of the century and sold a few years later – as “strategic mistakes”. The group has since focused mainly on organic growth, with the exception of acquisitions of suppliers.

    Both Prada and Versace have their roots in Milan and still have headquarters there, just four kilometres (2.5 miles) apart.

    Milan-based Moncler, the mountain gear brand that was bought and revived by Italian entrepreneur and current main shareholder Remo Ruffini in 2003, has also shown some interest in dealmaking, buying Italian streetwear brand Stone Island in a $1.3-billion deal agreed in late 2020.

    Moncler’s net cash position of $1.5 billion has fuelled analyst talk of more deals, but the group has denied such speculation.

    Jil Sander is now part of Italian entrepreneur Renzo Rosso’s OTB Group, which also includes brands such as Diesel and Maison Margiela. But with annual sales of $1.9 billion, it remains relatively small.

    The big Paris-based groups, meanwhile, have continued to make forays into Italy, underscoring the challenge an enlarged Prada would face to compete with them.

    In the latest deals, Kering bought a 30 per cent stake in Italian maison Valentino in 2023, and LVMH last year helped to take Tod’s private and took a 10 per cent stake in Moncler’s top shareholder.

    In the longer-term, eyes are on companies such as Milan-based Armani and Dolce & Gabbana, among the few in Italy that are still fully family-owned and unlisted.

    Their ultimate fates could be decisive in any effort to create a true Italian powerhouse in global fashion.

  • Prada looks to double China business in the medium term

    Prada looks to double China business in the medium term

    Prada is looking to double its business in key luxury market China, Chief Executive Gianfranco D’Attis said on Wednesday, even as the country faces slowing growth in luxury demand and significant economic headwinds.

    “We have a lot of ambitions here in China, to double our business in the upcoming mid-term future. And with that comes also increasing our investments,” D’Attis told reporters in Shanghai.

    He did not give an exact timeframe for the ambition but said increased investments would not necessarily mean a major uptick in the number of stores opening across the country.

    “Not only the number of stores is important to us, but the quality of stores, bigger stores with more categories, with more localized products, with more experiences, with more hospitality, more events, more special capsules,” he said.

    D’Attis, a former Dior executive who took the helm at Prada in January, was speaking at a preview of the brand’s Pradasphere II exhibition in Shanghai. This is the second iteration of a concept that first showed in London.

    As well as a deep dive into the brand’s archive and identity, Pradasphere II, which is showing at a museum on Shanghai’s Huangpu River, also includes a Prada-themed cafe and a gift shop in a repurposed train parked alongside the museum.

    According to D’Attis, this likely won’t be the last time fans of the brand in China get to enjoy something like the Prada cafe, which boasts premium Italian coffee. Developing a hospitality concept is on the agenda for the brand worldwide, including in China, he said, possibly in 2024 or 2025.

    The Prada Group, whose brands also include classic English shoemaker Church’s, reported a 10% rise in third-quarter revenues in November, saying a strong performance in Asia and Europe helped to compensate for weakness in the Americas.

    According to consultants Bain, China is forecasted to account for almost 40 percent of global luxury sales by 2030.

    D’Attis is hopeful Chinese consumers will return to traveling and shopping in greater numbers in Europe, but said that wouldn’t necessarily impact sales at home.

    “Because we have such a different offer abroad than the local offer that we have, we believe that there is no cannibalization,” he said.

    “They will continue to spend locally, they will continue to be treated like kings and queens in China and when they travel, they get a different product… than they can find in China. So it’s very complementary.”

    Prada is not alone in remaining optimistic about China’s post-pandemic market. Even as luxury growth slows in the world’s second-largest economy, spooking investors, global brands from Louis Vuitton to Chanel have all recently staged events in cities such as Shanghai and Shenzhen.

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  • Prada sales surge in nine months

    Prada sales surge in nine months

    Prada Group enjoyed higher net revenue in the first nine months of FY23, with Miu Miu delivering outstanding results, attributed to growing brand awareness and increasingly strong client relationships worldwide.

    The luxury retailer saw net revenue rise 17 percent year over year to US$3.53 billion in the nine months ended September 30.

    Retail sales of Prada brand jumped 13 percent, while Miu Miu surged 49 percent.

    “In the third quarter, Prada remained on a sound growth trajectory, driven by solid full-price like-for-like sales. Miu Miu continued to deliver a strong performance across all geographies and categories,” said Andrea Guerra, CEO at Prada Group.

    “In an uncertain geopolitical and economic backdrop that requires us to stay vigilant, we continue to see positive momentum in the business and strong excitement around our brands, positioning us well for Q4 and vis-à-vis our ambition to deliver solid, sustainable, and above-market growth in FY23.”

    The group’s retail sales soared 17 percent to $3.15 billion while wholesale sales inched 6 percent higher to $307.6 million. Royalties swelled 67 percent to US$77.2 million.

    Japan posted the highest retail sales growth across all geographies at 47 percent. Retail sales in Asia Pacific, Europe, and the Middle East grew 21 percent, 17 percent, and 12 percent, respectively.

    The company experienced a slight decline of 1 percent in retail sales in the Americas.

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  • Prada works with Amazon to nab Chinese counterfeiter

    Prada works with Amazon to nab Chinese counterfeiter

    Prada Group and other luxury retailers collaborated with Amazon’s Counterfeit Crimes Unit (CCU) to provide information to Chinese authorities, resulting in a case against a counterfeit items seller who pleaded guilty.

    “We are firmly committed to eradicating the sale of counterfeit goods to protect our brands and to ensure that our products meet the level of quality, craftsmanship and care that people expect from us,” said Francesca Secondari, general counsel and chief legal officer at Prada Group said.

    Amazon’s CCU detected the attempted counterfeiting back in 2021, followed by an investigation. Amazon provided the evidence to the relevant regional Chinese enforcement agency to lodge a criminal case against the accused.

    The defendant has been sentenced to three years in prison and obliged to pay a $25,000 fine.

    All the counterfeit products found in the defendant’s inventory will be destroyed and revenue from selling such items will be forfeited.

    “The guilty plea is a significant win for Amazon’s CCU, but more importantly it’s a win for all of those who share our commitment to tackling the industry-wide issue of counterfeiting,” said Kebharu Smith, director at Amazon’s CCU.

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  • Prada hires former Luxottica chief Andrea Guerra as new CEO

    Prada hires former Luxottica chief Andrea Guerra as new CEO

    Patrizio Bertelli, the current CEO of the premium brand, will be chosen chairman at the annual shareholder meeting next spring. He will succeed Paolo Zannoni, who will be proposed for the position of executive vice chairman of the group and chairman of Prada Holding, the parent firm.

    Current Co-CEO Miuccia Prada, age 73, will continue to serve as creative director of the Miu Miu and Prada brands, the latter with Belgian designer Raf Simons, and as a board member.

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