Kering: 2026Q2 Earnings

Q2 and H1 2026 Financial Highlights

For the second quarter of 2026, Kering reported consolidated revenue of €3,652 million, representing a 1% increase on a reported basis and 2% growth on a comparable basis. This marked a positive turning point, returning the group to top-line organic growth.

For the first half of 2026, total revenue reached €7,220 million, down 3% on a reported basis due to foreign exchange headwinds, but up 1% on a comparable basis.Recurring operating income held steady at €921 million, yielding a recurring operating margin of 12.8% (up 40 basis points year-over-year).Net income attributable to the Group was €189 million, impacted by non-recurring restructuring and realignment charges.Free cash flow from operations reached €2.6 billion, and net financial debt fell sharply to €3.3 billion (down €4.7 billion from December 31, 2025), largely bolstered by €4.0 billion in cash proceeds from completing the sale of Kering Beauté to L’Oréal.

Revenue Breakdown by Brand Segment and Geography

Kering categorizes its official revenue reporting by brand segments and geographical regions:

Product and House Segments (H1 2026)

Kering Fashion & Leather Goods (€5,800 million, ~80.3% of group revenue):Down 5% reported and 1% comparable. Houses in this segment manufacture and distribute high-end leather goods, ready-to-wear apparel, shoes, and accessories.
- Gucci (€2,757 million, ~38.2% of total group revenue):Down 9% reported (-5% comparable).Gucci designs and sells iconic leather goods, handbags, apparel, and footwear.Retail revenue accelerated in Q2 (-2% comparable) compared to Q1 (-8% comparable).
- Saint Laurent, Bottega Veneta, Balenciaga, Alexander McQueen, Brioni:Saint Laurent and Bottega Veneta showed sequential acceleration in direct retail sales across core leather categories, while Brioni delivered another quarter of solid top-line performance.
Kering Jewelry (€521 million, ~7.2% of group revenue):Up 14% reported and 20% comparable. Encompasses fine jewelry houses including Boucheron, Pomellato, Qeelin, and DoDo. Direct retail network sales surged 28% on a comparable basis.
Kering Eyewear & Corporate / Other: Focuses on luxury optical frames and sunglasses for group brands and licensed partners. Delivered steady single-digit growth across key wholesale and retail distribution channels.

Geographical Revenue and Regional Trends

North America: Served as the strongest growth engine during H1 2026. Gucci recorded +7% growth in North America, benefiting from robust luxury consumer spending.
Western Europe: Experienced slight revenue compression (-6% for Gucci in H1 2026), impacted by fluctuating tourist traffic and cautious local luxury demand.
Asia Pacific (excluding Japan):Revenue remained down (-8% for Gucci in H1 2026). Greater China recorded a slow recovery in foot traffic and high-end consumer spending.
Japan: Sales softened (-16% for Gucci in H1 2026) due to high comparison bases from prior currency-driven tourist spending waves.

Sequential Changes, Key Observations for Next Quarter, and Future Outlook

The primary sequential shift was the return to positive comparable revenue growth (+2% in Q2 2026 vs. 0% in Q1 2026). Direct retail sales improved by 4 percentage points quarter-over-quarter, led by a 7 percentage point acceleration at Gucci.Additionally, Kering’s recurring operating margin expanded to 12.8% (+40 bps) as execution cost controls took effect.

Key observation focal points for Q3 and Q4 2026 include:

Gucci Turnaround Momentum:Tracking whether direct retail sales achieve positive comparable growth as new artistic vision collections achieve full global store penetration.
Asia Pacific Luxury Demand: Monitoring foot traffic and conversion rates in Mainland China and key Asian hubs following recent luxury segment pullbacks.
Capital Allocation and Debt Control: Evaluating how the €3.3 billion net debt position and cash buffer of €8.5 billion are utilized for selective retail distribution elevation and brand elevation investments.

For the full year, management expects sequential improvement to persist, aiming to sustain operating margin discipline while reinvesting in brand equity and direct-to-consumer store upgrades.

Stock Price Performance Over the Past 3 Months

Over the past three months (May to August 2026), Kering’s stock (Euronext: KER) traded in a broad range between €236 and €294 per share.

May to Early July 2026:Shares experienced persistent downward pressure, dipping toward multi-year lows near €236-€250. This was driven by macro headwinds in European luxury, slower demand in China, and weak Q1 2026 revenue reporting (-6.2% reported).
Late July 2026 Rally: Following the publication of Q2/H1 2026 financial results on July 28, 2026, the stock surged over +15% in a single session and reached intra-day highs near €294. Investors reacted positively to Q2 comparable revenue returning to growth (+2%), a 40 bps operating margin expansion, and a massive debt reduction to €3.3 billion following the Kering Beauté transaction.
August 2026: The stock consolidated around €268-€270 per share, reflecting broader market stabilization as investors weigh structural turnaround timing against ongoing macro luxury headwinds.

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