The third quarter 2025 earnings season has just ended for the luxury sector, marking the continuation of the normalization phase that began three years ago. The segment as a whole remains profitable and structurally buoyant, but the performance gap between groups has never been so wide.
On the one hand, brands with a clear identity and total industrial control, such as Hermès and Brunello Cucinelli, continue to post double-digit growth and record profitability. On the other hand, groups undergoing repositioning, such as Kering and Burberry, are still struggling to regain momentum, hampered by consumers who have become more selective and by the transition of their flagship brands.
Hermès and Cucinelli: quiet excellence
Hermès remains the gold standard in the sector. The group posted sales of €3.88 billion in Q3 2025, up 9.6% at constant exchange rates, driven by strong demand for leather goods (+13%). America (+14%) and Europe remain very dynamic, while mainland China, which has long been lagging behind, is showing signs of recovery.
Management remains committed to its long-term strategy of organic growth, integrated production, and the gradual opening of workshops (a new factory in Louviers, expansion in Gironde). The brand does not depend on wholesale (distribution via retailers, editor’s note) or mass tourism, and continues to cultivate its rarity. Operating margins are expected to exceed 40% once again, an unprecedented level in the industry. The same philosophy applies at Brunello Cucinelli, which continues to pursue its path of artisanal excellence. With growth of +12% at constant rates in Q3, the Italian fashion house exceeded €1 billion in revenue over nine months, confirming its annual guidance of around +10%. North America and China are posting double-digit growth, driven by a high-income customer base that is relatively insensitive to the economic cycle.
Cucinelli combines a local production model (Made in Italy) with its own distribution network, enabling it to protect its margins despite the strength of the euro. The management team is also committed to “human and harmonious” growth, focusing on sustainability rather than rapid expansion.
Prada and Miu Miu: Italian revival
The Prada group is in robust health, with retail growth of +8% in Q3 and +9% over nine months. The positive surprise comes from Miu Miu, whose sales jumped 29%, driven by a strategy perfectly aligned with “youth premium” trends and contemporary women’s fashion. Conversely, the Prada brand experienced a slight decline (-1%), although momentum is picking up thanks to leather goods and accessories.
The rebound in demand in China and the performance of the United States offset the continuing weakness in Japan and certain European capitals, where tourist spending is down. Prada is also continuing its structural transformation, refocusing on its own distribution channels, digitizing its CRM, and developing its menswear segment.
Richemont: watchmaking and jewelry hold steady
Switzerland’s Richemont, owner of Cartier, Van Cleef & Arpels, Piaget, IWC, and Jaeger-LeCoultre, also posted a solid third quarter, confirming the robustness of the watch and jewelry segment despite a more uncertain global environment. Revenue for the quarter (ended September 30) reached €5.8 billion, up 6% at constant exchange rates. The Jewelry Houses, the group’s driving force, grew by 8%, driven by Cartier and Van Cleef, particularly in America and the Middle East.
Richemont continues to post one of the strongest balance sheets in the sector (with net cash in excess of €6 billion) and an operating margin of over 25%. The group benefits from the universal prestige of its Maisons and demand for fine jewelry, a segment that is structurally less sensitive to cycles.
Kering: the transition continues at Gucci
Kering posted revenue of €3.4 billion, down 5% on a comparable basis in Q3, but still much better than the 15% decline in the previous quarter. Still penalized by the creative transition last March from Sabato De Sarno to Demna, the Gucci brand remains the main source of fragility: down 14% on a comparable basis. The reception of Demna’s first collections is considered “encouraging” by management, with a sequential improvement observed in North America and Europe. Asia, on the other hand, remains sluggish.
The group’s other brands show contrasting trajectories: Bottega Veneta is up slightly (+3%), Saint Laurent is down -8%, and “Other brands” (Balenciaga, Alexander McQueen) continue to struggle. The group continues to reduce its dependence on wholesale and increase the selectivity of its distribution. The recovery plan is based on a return to desirability and the move upmarket of Gucci, with an impact expected from 2026 onwards. Investors see Kering as a recovery story and have bought back the stock at a bargain price, with the share price rising 55% in Q3 thanks to the Luca De Meo effect.
In summary, the third quarter of 2025 illustrates a new maturity in the sector: gone is the widespread euphoria, replaced by selective growth driven by desirability, differentiation, and strategic discipline. Luxury is not entering a crisis, but rather an age of controlled sobriety, and only the artisans of rarity will continue to shine.
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