MILAN — Ferragamo continues to execute its strategic initiatives, seeing growth in its direct-to-consumer channel, and in North America and Europe, partially offsetting a softer demand across Asia.
During a conference call with analysts on Tuesday, executive board member Ernesto Greco said, “The market backdrop remained particularly challenging during the third quarter, impacted by ongoing geopolitical tensions and a generally subdued consumer environment over the summer, with weaker sentiment slowing the positive momentum across several key markets and further deteriorating the trend in Asia, in particular in China.”
He touted “a gradual strengthening of the underlying business trends,” and despite persistent macroeconomic and geopolitical uncertainties, Greco said the group remains “confident in the relevance of its medium to long-term strategic direction.”
In the nine months ended Sept. 30, Ferragamo revenues declined 2.8 percent to 675 million euros, compared with 695 million euros a year earlier, reflecting the ongoing strategic rationalization of the wholesale channel.
Sales in the third quarter decreased 6.2 percent to 207 million euros. At constant exchange rates they were down 3.5 percent.
The DTC channel was up 1.9 percent to 537 million euros compared with 526 million euros. At constant exchange rates, the channel rose 4 percent.
Excluding China and Japan, all markets showed positive performance at constant exchange.
In the third quarter, the DTC channel was up 2.3 percent supported by the positive performance of full-price sales in the primary retail channel.
At constant exchange, the retail business was quite negative in July, then “flattish” in August, picking up positively in September and in October, said Greco.
Wholesale
Wholesale sales in the nine months fell 15 percent to 123 million euros compared with 145 million euros a year earlier.
In the third quarter, the channel was down 24.2 percent, reflecting the group’s continued focus on enhancing the quality of distribution.
The wholesale streamlining is “in an advanced” phase with “a probable still negative comparison in the first half of 2027,” said Greco, while in the second half of next year “we will see a stabilization and hopefully an increase realized in reputable points of sale.”
The wholesale business should “not be a sort of ancillary channel, but of course it should be handled in a proper manner,” said the executive, adding that it would allow the brand to also penetrate the Middle East, which still represents only between 1.3 and 1.5 percent of sales and is an area that offers “a very interesting opportunity.”
Greco said the performance in the U.S., Latin America and Europe offset that of Japan and of China, ”the real problem, and to be honest, we can’t understand if this is just a temporary slowdown” or not.
As of Sept. 30, sales in Europe amounted to 161.7 million euros, down 8.6 percent and representing 24.6 percent of the total.
Sales in North America rose 7.3 percent to 222 million euros accounting for 33.6 percent of total revenues.
Revenues in Japan fell 12 percent to 50.4 million euros. At constant exchange, sales in the region decreased 2.2 percent.
By Region
Sales in Asia-Pacific were down 6.1 percent to 166.6 million euros, accounting for 25.2 percent of the total.
“What we should better understand is the evolution of the Chinese market, because everyone was assuming that in the second part of 2026, the Asian, namely the Chinese market, was going up, but as far as we can see, this is not happening, and certainly only some specific players for specific reasons can still realize positive momentum in this country. Although I believe there is also a perimeter effect, which of course can change the situation.”
In China, Greco said the main problems are related “to the so-called affluent customers, while the other category, the more wealthy, the diamond customers, I believe they are quite resilient, and to some extent we are experiencing some activities trying to address them with some services, and we are receiving positive results. We are inviting, for example, some customers even in Florence or in other locations in China, and we serve them in a special manner, and we are receiving positive feedback. I believe that this means that the recovery of the Chinese market will pass mainly [through] attracting wealthy customers, while some affluent customers probably will be will be lost, and this is not only for Ferragamo but probably for the sector.”
He said Ferragamo next year will close some stores in China mainly in tier-three cities, expecting to perform well with direct online sales in that market.
Revenues in Central and South America rose 11.2 percent to 59 million euros. “Latin America is a very interesting market for Ferragamo, and we are analyzing the possibility even to enlarge this market because the brand has a very interesting positioning in terms of awareness and in terms of reputation,” said Greco.
Performance by Category
Sales of footwear rose 1.3 percent to 297 million euros, while leather goods were down 5.8 percent 270.3 million euros. Apparel rose 2.6 percent to 41.8 million euros and silk inched up 0.3 percent to 50.8 million euros.
On the call, Greco was asked about translating the positive feedback of the spring collection designed by creative director Maximilian Davis into commercial success and said, “We probably made some progress, but I believe that this process, which of course involves not only the art director but also the merchandising team, the logistic team, some researchers even outside from the company, must [be refined] so we are on the right track but there is room for improvement.”
Asked about the consensus of 950 million euros in net revenues, Greco said “it is difficult to say if it would be achievable. I would say that it assumes a nice, a good Christmas sales season. We live in a very turbulent environment, and the business shows a certain volatility.”