What: Kering’s second-quarter recovery was driven by operational discipline, Gucci’s improving performance and progress on store and debt reduction.

Why it is important: Kering’s recovery shows how luxury groups are using cost discipline, store optimisation and brand repositioning to rebuild profitability after a downturn.

Kering returned to growth in the second quarter, posting its first comparable sales increase in three years as Luca de Meo’s turnaround plan began to show results. Revenue rose 1% at reported exchange rates to €3.65 billion, or 2% on a comparable basis, ahead of expectations. First-half recurring operating profit was stable at €921 million, while the operating margin improved to 12.8%. The recovery was supported by store optimisation, cost discipline, inventory reduction and debt reduction. Kering closed 84 stores in the first half, moving toward its target of 100 net closures this year, and reduced net debt to €3.3 billion after selling its beauty division and real estate assets. Gucci remained under pressure but performed better than expected, with organic sales down 2% after an 8% decline in the first quarter. Leather goods returned to growth, supported by new bags and stronger U.S. demand. Kering is also prioritising China, where it is implementing a dedicated plan for more selective, experience-driven consumers.

IADS Notes: Kering’s return to growth in the second quarter suggests that Luca de Meo’s turnaround plan is beginning to gain traction after a difficult year documented in notionnews. In April 2026, the Financial Times reported that Kering aimed to double profitability through operational efficiency, debt reduction, store closures, restructuring and brand repositioning. The urgency of that plan was clear in July 2025, when WWD reported a 46% fall in first-half net profit, Gucci’s 25% sales decline and an expanded target of 80 store closures. By October 2025, WWD noted early signs of stabilisation, with Gucci’s decline slowing, North America improving and Asia-Pacific stabilising, even as group revenue remained down 10%. BoF’s September 2025 analysis of Luca de Meo’s appointment framed the leadership change as a shift toward external turnaround expertise, cost rationalisation, debt reduction and repositioning of Gucci, Balenciaga and McQueen. WWD’s February 2026 coverage of Kering’s 2025 net loss then showed the scale of the reset, including €925 million in cost savings, 75 store closures, beauty and real estate asset sales and early signs of renewed store energy.

Kering returns to growth in 2026 Q2