In FY24, Italian fashion house Valentino registered a 22 per cent decline in the brand’s operating profit. This decline reflects a broader slowdown in global demand for high-end goods within the luxury sector, particularly in Asia.
European luxury conglomerates had been looking to affluent American consumers to revitalize growth, given the uncertain outlook for China. However, following President Donald Trump's tariff policies, the industry is now preparing for what could be its most prolonged downturn in years.
As per Valentino, the brand’s one-time expenses also contributed to its operating profit falling to €246 million ($280 million) in 2024, as the company continued to invest in its directly operated stores.
The brand’s revenue declined by 2 per cent at constant exchange rates, to €1.31 billion. Despite robust sales in Japan, the Middle East, and the Americas, the Rome-based company faced overall headwinds.
On a positive note, Valentino’s online sales rose by 5 per cent increase compared to the previous year, aligning with the group's strategic objective to strengthen its e-commerce operations.
In March 2024, Valentino appointed the former Gucci designer Alessandro Michele as its new Creative Director following the departure of Pierpaolo Piccioli, who held the position for 25 years.
In 2023, Kering, the parent company of Gucci, acquired a 30 per cent stake in Valentino, with an option to purchase the remaining share capital by 2028. The recent financial results underscore the challenges facing the luxury market as a whole, even for established brands undergoing significant creative transitions.
