Kering Shares Rise Despite 2024 Income Warning

PARIS (Reuters) – Shares in Gucci-owner Kering (EPA:PRTP) rose on Thursday, despite the French luxury goods company's warning that 2024 operating income would almost halve to its lowest in years due to weak demand in China.

Kering shares were up 0.5% at 0729 GMT, following positive results from rival Hermes, which helped lift the broader luxury sector.

The owner of fashion brands Saint Laurent, Balenciaga, and Bottega Veneta also posted a larger-than-expected 16% drop in third-quarter revenue.

The company's stock has faced challenges this year, sliding more than 40%, making it the worst performer in the luxury sector. A trading source noted that the guidance cut did not come as a surprise, as the bad news was already "priced in."

Analysts at RBC commented, "Kering is controlling their controllables (e.g., cost control, efficiency focus, store optimisation) in a difficult luxury environment; however, relative performance is below average and FY25E margin visibility is low."