Financial Data and Key Metrics Changes - The Prada Group recorded net revenues of €4.1 billion in the first nine months of 2025, representing a 9% increase compared to the same period last year at constant foreign exchange rates [7] - Retail sales increased by 8% in Q3 compared to the prior year, while wholesale sales rose by 4% in the first nine months and 19% in Q3 [8][9] - Royalties grew by 11% over the periods, supported by eyewear and beauty segments [9] Business Line Data and Key Metrics Changes - Prada's performance was resilient, with a -2% change in the first nine months, while Miu Miu reported a significant growth of 41% for the same period and 29% in Q3 [9][10] - Church's also returned to double-digit growth in the quarter [10] Market Data and Key Metrics Changes - Asia Pacific saw a 10% growth in the first nine months, with Q3 showing similar trends [10] - Europe experienced a 6% increase in retail sales over the nine months, while the Americas reported a 15% growth, accelerating to 20% in Q3 [10] - Japan's growth was modest at 3% over the nine months, with Q3 down 1% but showing improvement [10] Company Strategy and Development Direction - The company is committed to maintaining its creative leadership and investing in desirability, with a focus on retail excellence and product innovation [12] - There is a cautious approach to store expansion for Prada, with plans to open 6-8 new stores while closing underperforming locations [23] - The company aims to balance its product offerings across different price points and categories, with a focus on high-value segments [34] Management's Comments on Operating Environment and Future Outlook - Management noted a plateau in growth in China, with expectations of gradual improvement rather than a return to previous high growth rates [17][47] - The company is optimistic about the upcoming holiday season and expects continued improvement in sales [12] - Management emphasized the importance of the last six weeks of the year for overall performance [12] Other Important Information - The company is experiencing a normalization in traffic levels, which is impacting sales performance [5] - The impact of foreign exchange rates is expected to be significant in Q4, with a negative effect of approximately 260 basis points in the first nine months [9] Q&A Session Summary Question: Initial priorities for Versace integration - The transaction is not yet closed, and the company is awaiting necessary authorizations [16] Question: Current trading and improvement in Q3 - Management observed a plateau in China, with some positive signs during holidays, but overall conditions remain stable [17] Question: Wholesale trends in Q3 - There were no exceptional factors affecting wholesale trends; the growth was consistent [19] Question: Cluster trends for key Prada brands - All clusters showed positive growth, with local transactions driving improvements [21] Question: Store expansion plans for Prada and Miu Miu - Miu Miu has seen successful store openings, while Prada is taking a more cautious approach to expansion [23] Question: Margin expectations for the upcoming year - Management did not provide specific guidance on margins but indicated that they are on track to meet previous targets [27] Question: FX headwinds for H2 - Hedging strategies are expected to mitigate FX impacts for 2025, but 2026 may face challenges [31] Question: Pricing policy for next year - The company plans to maintain its pricing strategy with regular adjustments [68] Question: Growth by category in Q3 - Miu Miu's ready-to-wear category and Prada's leather goods showed the most significant growth [70]

Core Viewpoint - L'Oréal's second-quarter financial results disappointed investors, with a sales decline and lower-than-expected comparable sales growth, despite exceeding profit expectations [1][2]. Financial Performance - Second-quarter sales decreased by 1.3% year-on-year to €10.74 billion, with comparable sales growth at 2.4%, below the analyst expectation of 2.9% [2]. - For the first half of 2025, net profit (excluding non-recurring items) was €3.78 billion, a 1% year-on-year increase, and operating profit margin improved by 30 basis points [2]. Core Business Analysis - The professional products division led growth with a 6.5% increase, while the high-end cosmetics division grew only 2%, lagging behind the mass market (2.8%) and active health cosmetics (3.1%) [2]. - The fragrance category stood out with double-digit growth, significantly exceeding the market average of 7% [8]. Regional Performance - North Asia, particularly China and South Korea, along with travel retail channels, were major contributors to the sales decline, with North Asia's sales down 1.1% year-on-year [2][5]. - Emerging markets showed strong growth, with South Asia-Pacific, the Middle East, North Africa, and Sub-Saharan Africa achieving 10.4% growth, and Latin America at 10.3% [6]. Tariff Concerns - The European Union's decision to impose a 15% tariff on cosmetics imported from the U.S. poses a significant risk, as approximately 30% of L'Oréal's U.S. sales depend on imports [2][6]. - The CEO expressed serious concerns and plans to lobby for exemptions, while also considering potential price increases or shifting production to U.S. factories [7][6]. Growth Strategy - Despite the challenges, the company remains optimistic about the second half of the year, planning to launch new products like Prada men's perfume and Miu Miu perfume as part of a "beauty stimulus plan" [8].

Core Viewpoint - L'Oréal's Q2 financial results disappointed investors, with a sales decline and lower-than-expected comparable sales growth, raising concerns about its "multi-polar" growth strategy amid pressures from the Chinese market and trade tensions in Europe and the U.S. [1][4] Financial Performance - Q2 sales amounted to €10.74 billion, a year-on-year decline of 1.3%, with comparable sales growth at 2.4%, below the market expectation of 2.9% [4] - Operating profit for the first half reached €4.74 billion, exceeding analyst expectations of €4.69 billion [1] - Net profit (excluding non-recurring items) for the first half was €3.78 billion, a 1% year-on-year increase, with an operating margin improvement of 30 basis points [4] Business Segment Performance - The professional products division led growth with a 6.5% increase, while the core luxury cosmetics division grew only 2%, lagging behind the mass market (2.8%) and active health cosmetics (3.1%) [4][6] - The fragrance category stood out with double-digit growth, significantly outperforming the market average of 7% [6] Regional Performance - Sales in North Asia, particularly in China and South Korea, declined by 1.1% to €5.39 billion, contributing to overall performance challenges [3][4] - Emerging markets showed strong growth, with South Asia-Pacific, the Middle East, North Africa, and Sub-Saharan Africa achieving 10.4% growth, and Latin America at 10.3% [5][6] - Core markets like Europe and North America experienced slower growth, with increases of 3.4% and 2%, respectively [5] External Challenges - The European Union's decision to impose a 15% tariff on cosmetics imported from the U.S. poses a significant risk, as approximately 30% of L'Oréal's U.S. sales rely on imports [4][5] - The CEO expressed serious concerns about the tariff's impact and indicated potential strategies such as price increases or shifting production to U.S. facilities [5][6]