Kering Jumps as Gucci Slide Eases

Core Viewpoint - Kering shares surged as the company reported results that were weak but better than feared, indicating a potential turnaround under new CEO Luca de Meo [1][6] Financial Performance - Fourth quarter revenue fell 3% year on year to €3.9 billion, surpassing expectations for a steeper decline [2] - Gucci, Kering's largest brand, experienced a 10% revenue decline to €1.6 billion, marking its tenth consecutive quarterly fall but slightly better than forecasts [3] - For the full year 2025, group revenue decreased 10% to €14.7 billion, and operating income dropped 33% to €1.6 billion, indicating a second consecutive year of double-digit profit declines [4] Strategic Changes - CEO Luca de Meo, who joined from Renault, stated that 2025 does not reflect Kering's true potential and described recent sales momentum as early and fragile but real [5] - The company proposed cutting its dividend to €4 per share from €6 the previous year, including a €1 special dividend linked to the sale of its beauty business to L'Oréal for €4 billion [5] - Kering confirmed plans to close around 100 more stores in 2026 after shutting 75 last year [5] Market Reaction - The market's positive reaction reflects a reset of expectations rather than a fundamental recovery, as Kering's share price had fallen over 50% in the past three years [6] - Investors appear to be optimistic about de Meo's leadership, as he has openly acknowledged past mistakes and emphasized the need for a more realistic approach to the company's challenges [7]