By Robert Williams and Albertina Torsoli
Gucci surged past rival Hermes as shoppers snapped up more of designer Alessandro Michele’s crystal-and sequin-coated creations over the Christmas trading period.
The Italian fashion label closed out the year with another quarter of runaway growth, with comparable sales rising 43%, parent Kering said. Its revenue of €6.2bn last year surpassed the €5.5bn posted by rival Hermes International.
Despite the strong performance, the company said the strength of the euro could hit its results over the coming year amid an “unsettled” economic and geopolitical environment.
Kering shares fell as much as 4% yesterday, though they’ve risen about 60% over the last year. Gucci’s efforts under designer Michele and CEO Marco Bizzarri have seen the Italian label roar back after years of sluggish sales.
That’s pushed it past Hermes, which has ridden rising demand for its high-end handbags, into second place among fashion brands owned by listed companies. It now trails only Louis Vuitton, the LVMH-owned leather-goods maker that has sales of more than €9bn.
Last month Kering took a step toward fulfilling its aim of becoming a pure player in luxury fashion when it proposed spinning off a majority of shares in German sportswear brand Puma to its own investors.
Millennial shoppers have been leading the luxury industry’s rebound, with customers under the age of 35 making up 85% of growth last year.