Financial Data and Key Metrics Changes - The company reported full year 2025 revenues of EUR 1,917 million, a decrease of 1.5% year-over-year on a reported basis, but an increase of 1.1% on an organic basis [9] - Gross margin reached 67.5%, up 90 basis points, primarily driven by a shift in channel mix with Direct-to-Consumer (DTC) accounting for 82% of branded revenues compared to 78% the previous year [10] - Adjusted EBIT was EUR 163 million, which included EUR 10 million in provisions related to losses on trade receivables [9][10] - The company achieved a profit of EUR 109 million, a 20% increase from EUR 91 million in the previous year [10] - The effective tax rate decreased to 22% from 30% due to non-taxable income related to the remeasurement of put option liabilities [15] Business Line Data and Key Metrics Changes - The Zegna segment generated an adjusted EBIT of EUR 197 million with a margin of 14.4%, up from 13.9% the previous year [13] - The Thom Browne segment was significantly impacted by a reduction in revenues, achieving only EUR 1 million in adjusted EBIT [14] - The Tom Ford Fashion segment reported a loss of EUR 16 million in adjusted EBIT for the first half of the year, but showed improvement in the second half [14] Market Data and Key Metrics Changes - The Middle East region represents a mid-high single-digit share of the company's total revenues, with all stores in the area currently open and operating [18] - The Americas, particularly the United States and Latin America, showed resilience with continued growth, while Europe also remained stable despite the conflict in the Middle East [27] Company Strategy and Development Direction - The company is focusing on enhancing its brand presence through strategic collaborations, such as the Thom Browne sneaker launch with ASICS, which has exceeded revenue expectations [4][5] - Zegna aims to build a brand that integrates fashion, culture, and landscape, with upcoming events like the spring and summer 2027 fashion show in Los Angeles [8] - The company is committed to a long-term vision, investing in talent and infrastructure to support brand growth, particularly for Thom Browne and Tom Ford [11][29] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding the current trends, noting slight improvements in DTC performance compared to Q4 2025, despite uncertainties from the Middle East conflict [26] - The company remains cautious about the Chinese market, expecting a flattish performance for the year while acknowledging slight improvements during the Chinese New Year [27] - Management highlighted the importance of maintaining strong relationships with customers in the Middle East and adapting strategies to the evolving market conditions [41] Other Important Information - The company plans to open new stores in Abu Dhabi by the end of the year, continuing its expansion strategy in the Middle East [116] - Capital expenditures for 2025 reached EUR 103 million, with expectations for increased investments in 2026 related to a new shoe factory [16] Q&A Session Summary Question: Update on top-line momentum and regional trends - Management noted that the year has started well with trends slightly better than Q4 2025, particularly in DTC, despite uncertainties from the Middle East conflict [26] Question: Zegna segment EBIT margin expectations - Management indicated that the Zegna segment's EBIT margin could improve, with a focus on long-term profitability rather than short-term results [29] Question: Impact of foreign exchange on profitability - Management acknowledged a potential headwind of around 2 points from currency fluctuations affecting profitability in 2026 [30] Question: Changes in consumer behavior due to the current environment - Management reported no significant changes in consumer behavior outside the Middle East, where traffic has decreased [36] Question: Pricing environment and opportunities for higher pricing - Management confirmed ongoing low to mid-single-digit price increases and an upward evolution of the product mix [47] Question: Shipment status and rent structure in the Middle East - Management confirmed that shipments to the Middle East are ongoing, with a mix of variable and fixed rents [62] Question: Profitability improvements for Tom Ford in H2 - Management highlighted improvements in gross margin and operational efficiency as key drivers for Tom Ford's profitability in the second half [64] Question: Exposure to local versus tourist spending - Management indicated that local spending is predominant, with minimal exposure to tourist spending, particularly in Greater China [68]