Kering S.A.

Kering reported H1 2026 revenue of €7.2 billion, down 3% reported and up 1% comparable. Recurring operating income was €921 million, equal to a 12.8% margin, up 40 basis points year over year and 300 basis points versus H2 2025. Free cash flow from operations reached €2.6 billion, including around €800 million from real estate net proceeds and the Gucci beauty agreement; excluding those items, FCF was €1.8 billion, up 68% versus H1 2025. Net financial debt was €3.3 billion at June 30, down €4.7 billion from year-end 2025. Management confirmed 2026 guidance for growth and improved profitability versus 2025, and said H2 margin should be higher than H1. Gucci H1 sales were €2.8 billion, down 5% comparable, while Q2 revenue was down 2% comparable. Kering Fashion and Leather Goods was stable in Q2 comparable, Kering Jewelry rose 18% comparable in Q2, and Kering Eyewear rose 8% comparable in Q2.

Luca de Meo framed H1 as proof that the group is turning strategy into execution, pointing to brand playbooks, store optimization, inventory reduction, and tighter cost control. He said nearly all houses are seeing improved momentum, with Gucci showing sequential improvement and the group returning to growth in Q2 despite continuing network rationalization. His tone was optimistic but cautious: he repeatedly said the turnaround is still early, that Q3 could be flattish, and that 2026 progress may not be linear.

Armelle Poulou emphasized the financial improvement: 1% comparable revenue growth in H1, a 12.8% recurring operating margin, and a stronger balance sheet with net debt at €3.3 billion. She said OpEx was down 5% in H1 to €4.2 billion, driven largely by fixed cost reductions, while A&P stayed at around 9% of revenue. She also highlighted €419 million of CapEx, with €260 million excluding real estate investment, and said working capital improved by €863 million year over year, with the €1 billion inventory reduction target by year-end “well within reach.”

Analysts pressed on Gucci’s turnaround, asking what gives management confidence and whether the brand can turn positive for the full year. Luca said the first full collection from Demna is only now arriving in stores, that newness is working, and that leather goods are improving; he also said Q3 could be flattish, but the team is committed to delivering growth in 2026. Questions also focused on pricing, inventory, and OpEx: management said pricing is being repositioned to protect full price and align with desirability, inventory reduction is being supported by changes in production and replenishment, and Armelle said full-year OpEx can decline despite earlier flat guidance. On store closures, management reiterated the broader plan to close about 250 stores by 2028 and said they remain on pace after 84 net closures in H1.