Ermenegildo Zegna (ZGN) Q1 2025 TU earnings summary

Executive summary

• Q1 2025 revenues reached €459 million, down 1% year-over-year in both reported and organic terms, with ZEGNA and TOM FORD FASHION brands growing and Thom Browne declining due to wholesale channel streamlining.

• Direct-to-consumer (DTC) channel drove growth, up 5.2% year-over-year, now representing 81% of branded product revenues.

• Americas led regional growth with 9% organic increase, while Greater China revenues declined 12%.

• DTC channel performance was positive across all brands, offsetting sector challenges and wholesale declines.

Financial highlights

• ZEGNA brand revenues were €293 million, up 3% year-over-year, driven by DTC in EMEA and US.

• Thom Browne revenues were €64 million, down 19% organically, mainly due to a 48% drop in wholesale.

• TOM FORD FASHION revenues reached €67 million, up 3% organically, with strong DTC momentum.

• DTC revenues totaled €345 million (+5% YoY), now 81% of branded product sales; wholesale branded revenues dropped 19% organic.

• Textile product line declined 9% due to lower demand from external luxury brands.

Outlook and guidance

• Low single-digit EBIT growth guidance for 2025 reaffirmed, with price increases planned to offset US tariffs.

• Management remains vigilant amid geopolitical and economic uncertainties, focusing on brand strength and customer proximity.

• Expectation for Greater China to remain negative but less so through the year; Americas and EMEA to continue strong.

• Wholesale channel expected to remain a drag in 2025, stabilizing from 2026.