To receive the Vogue Business newsletter, sign up here.
Zegna Group sales grew 19.6 per cent in the fourth quarter to €570 million, the company said on Wednesday, an acceleration over the previous quarter’s 11 per cent rise. For 2023, full-year revenues reached €1.9 billion, up 19 per cent. Shares were up more than 9 per cent in morning trading.
Growth was led by the Greater China region (up 36 per cent), while EMEA was up 14.2 per cent and the US was up 4.4 per cent. By brand, Zegna revenues for the quarter totalled €385 million, up 18.2 per cent on an organic basis. Thom Browne’s Q4 revenues came in at €99 million, with an organic growth rate of 24.6 per cent. Revenues for the Tom Ford Fashion segment, calculated as of its consolidation on 29 April 2023, came in at €236 million in 2023, with Q4 revenues at €97 million.
A luxury slowdown, on shaky demand in China and a petering out-of-pandemic revenge spending, has come into focus since third-quarter earnings were reported in October. But companies with fewer aspirational customers like Zegna, alongside Brunello Cucinelli, have proved resilient. Last week, LVMH also bucked the slowdown trend, reporting sales up 9 per cent for its fashion and leather goods division to €11.26 billion on an organic basis, which prompted high activity in luxury stocks. Kering and Hermès are slated to report their full-year numbers on 8 and 9 February, respectively.
“While we have seen broad-based strength, I am particularly pleased by the continued growth in EMEA and the very positive performance in the US, which was driven by strong double-digit Zegna sales via the retail channel. These strengths, coupled with the rebound in the Greater China region, are testaments to the soundness of our long-term strategy,” Gildo Zegna, chairman and CEO of Zegna Group stated.
Zegna Group COO and CFO Gianluca Tagliabue noted that performance in China in Q4 was led by iconic products such as the Zegna Triple Stitch trainers, as well as “a slight increase in traffic”. While sales growth in the US lagged, the company said it’s bullish on the region. “We remain positive about America, we don’t see any slowdown,” Gildo Zegna told analysts on Wednesday.
Zegna’s recent “Oasi of Cashmere” show on 15 January signalled the brand’s focus on luxury materials. During the show, “models walked around an enormous mound of camel cashmere tufts that grew and grew as more floated down from the ceiling, to mimic the waste-collection (and eventual recycling) process that happens in the Zegna mill in Trivero”, wrote Vogue Runway’s Luke Leitch. “The collection was incredibly well received and praised for the way in which it brought high-quality raw materials to life,” according to the company. Thom Browne’s AW24 fashion show is set to take place in New York on 14 February, while the Tom Ford AW24 show is scheduled in Milan on 22 February.
“The Zegna transformation from suit manufacturer to elegant casualwear brand couldn’t have been bolder, faster and more effective,” Bernstein analyst Luca Solca says. “Add to that the successful transformation from single brand to multi-brand group, with both Thom Browne and Tom Ford holding a lot of promise. I particularly like how Zegna has been able to score home runs outside of its core apparel category — footwear being a landmark example. The marketing narrative leveraging Oasi Zegna — with its values of foresight, sustainability and respect of the environment — tops it all.”
Comments, questions or feedback? Email us at feedback@voguebusiness.com.
More from this author:
‘Being both entrepreneur and designer is what I like best’: Simon Porte Jacquemus on what’s next
What downturn? Couture defies the economic climate
Can Iris Van Herpen turn her couture brand into a household name?
