EARNINGS REPORT: The French luxury group’s H1 2026 results presentation shows a business stabilising at group level, but the regional detail reveals two very different stories playing out inside the same footprint.

Kering reported H1 2026 revenue of $8.23 billion (€7.22 billion) on Tuesday 28 July, up 1% on a comparable basis, while net profit fell 60% to $215 million (€189 million). Growth accelerated to 2% comparable in the second quarter alone, at $4.16 billion (€3.65 billion), and recurring operating income held essentially flat at $1.05 billion (€921 million), with the margin up 40 basis points to 12.8%. Net financial debt fell from $9.16 billion (€8.0 billion) to $3.79 billion (€3.32 billion). The profit decline was driven by non-recurring charges rather than the underlying operating business, which held steady, and the largest contributor to the debt reduction was the Kering Beauté disposal rather than ordinary cash generation. Kering Jewelry was the group’s fastest-growing business by revenue over the half, expanding in several of the same regions where Gucci, still the largest brand by revenue, continued to decline.

Fashion & Leather Goods

Fashion & Leather Goods, which houses Gucci alongside Saint Laurent, Bottega Veneta, Balenciaga, McQueen and Brioni, generated $6.61 billion (€5.8 billion) over the half, down 5% reported but only 1% comparable, with second-quarter comparable growth flat after a 3% comparable decline in the first quarter. Gucci itself brought in $3.14 billion (€2.76 billion), down 9% reported and 5% comparable over the half, though the second quarter’s 2% comparable decline was an improvement on the first quarter’s 8% drop. By region, Gucci’s revenue over the half fell 16% in Japan, 15% in the rest-of-world category, 8% in Asia Pacific and 6% in Western Europe, while North America grew 7%, the only region in positive territory. Kering’s presentation described Saint Laurent and Bottega Veneta as accelerating across nearly all regions in the second quarter, while Balenciaga had a more difficult quarter navigating its creative transition.

Jewelry

Kering Jewelry was the standout: half-year revenue of $594 million (€521 million), up 14% reported and 20% comparable, with retail sales up 28% comparable across the half. Regionally, Kering Jewelry grew 60% in Japan and 26% in Asia Pacific on a comparable basis. Kering Eyewear grew revenue 8% comparably to $1.1 billion (€965 million), with margin expanding nearly 300 basis points to 23%.

Asia and the Middle East

At group level, Asia Pacific accounted for 30% of half-year revenue and was flat year-on-year comparably, North America grew 9% and made up 24% of revenue, Japan grew 2% and represented 7%, Western Europe fell 2% at 30% of revenue, and the rest-of-world category, which includes the Middle East, fell 8% and made up 9%. Kering’s retail commentary attributes the rest-of-world decline explicitly to the conflict in the Middle East, while noting sequential improvement month after month through the second quarter.

The more striking pattern sits inside Asia Pacific itself, where the same region produced opposite results depending on category. Gucci’s revenue in Asia Pacific fell 8% over the half. Kering’s broader Asia Pacific commentary, which covers all of its houses together rather than Gucci alone, cited an “ongoing plan to turnaround” in mainland China and pointed to South Korea as a bright spot in the region, without specifying which houses that applied to. Kering Jewelry’s revenue in Asia Pacific, meanwhile, grew 26% on a comparable basis over the half, with Boucheron reaching what the company called new record levels there.

A similar pattern holds in Japan: down 16% for Gucci’s revenue over the half, up 60% on a comparable basis for Jewelry’s. Kering’s group-level Japan commentary cited a more favourable tourism backdrop than the first quarter, again without specifying which houses drove that. Regionally, then, Kering’s own numbers show hard luxury strengthening in Asia over the half even as Gucci continued to decline there.

Kering and LVMH, side by side

Kering’s second quarter, up 2% comparable, landed one day after LVMH posted organic growth of 3% for the same three months, with LVMH’s Fashion & Leather Goods division turning positive again after seven straight quarters in decline. Kering’s equivalent business moved in the same direction but got there more slowly, flat comparable in the second quarter after a 3% decline in the first, and Gucci itself remained in decline throughout, down 2% even as Dior and Louis Vuitton pulled LVMH’s fashion arm back into growth. Both groups leaned on the same two supports through the half: North America was the strongest market for each, and hard luxury, Kering’s Jewelry business and LVMH’s Watches & Jewellery division, grew faster than anything else in either portfolio. Underneath the headline numbers, the balance sheets tell different stories: Kering’s net profit dropped 60% on non-recurring charges, and its debt reduction relied heavily on the Kering Beauté disposal, while LVMH’s net profit held roughly flat year-on-year and its debt fell on the back of ordinary free cash flow. Hermès reports on Wednesday, rounding out the week.