Kering S.A.

H1 2026 revenue was €7.2 billion, down 3% reported and up 1% comparable. Recurring operating income was €921 million, with 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, free cash flow from operations was €1.8 billion, up 68% versus H1 2025. CapEx was €419 million, or €260 million excluding real estate investment, equal to 3.6% of revenue. Net financial debt was €3.3 billion at June 30, down €4.7 billion from year-end 2025. For Q2, comparable revenue grew 2% and the group said it expects H2 margin to be higher than H1. Full-year guidance reiterated by management was growth and improved profitability in 2026 versus 2025; the company also remains on track for at least 100 net store closures this year and its €1 billion inventory reduction target by year-end remains on track.

Luca de Meo framed H1 as a period of turning strategy into action, emphasizing brand playbooks, store optimization, inventory reduction, debt reduction, and tighter execution. He sounded constructive but realistic, saying the group is “at the beginning of the journey” and that the market remains demanding. On Gucci, he said newness is working, leather goods are performing positively, and the first complete collection from the new creative direction is now arriving in stores, but he cautioned the recovery may not be linear and China still needs fundamental work.

Armelle Poulou focused on improving financial discipline and balance sheet repair. She highlighted H1 recurring operating income of €921 million, a 12.8% margin, down 5% OpEx to €4.2 billion, and free cash flow from operations of €2.6 billion, with €1.8 billion excluding real estate proceeds and the Gucci beauty agreement. She also pointed to an improvement in working capital of €863 million year over year, net debt down to €3.3 billion, and said the tax rate should gradually return to 27% to 28% over the next two to three years. She confirmed H2 margin is expected to be higher than H1 and said the group now expects full-year OpEx to decline, despite earlier guidance for flat OpEx.

Analysts pressed on whether Gucci is truly on track, whether Q3 could turn positive, and whether full-year Gucci growth is achievable; Luca said Q3 could be flattish and that the brand is still in the early stages of recovery, but he is confident in the team and new collections. Questions also focused on China, pricing, and inventory: management said China needs a reset toward more local relevance and that pricing must protect full-price sales rather than rely on discounting. On inventory, Luca and Armelle reiterated the €1 billion reduction target for Fashion and Leather Goods by year-end, saying the reduction is coming from both better production discipline and a leaner operating model, not from broad discounting.