Kering (KER) Q4 2025 earnings summary

Executive summary

• Revenue for 2025 was €14.7 billion, down 13% as reported and 10% on a comparable basis, with Q4 showing sequential improvement; all major brands except Bottega Veneta and Kering Eyewear posted declines.

• Recurring operating income fell 33% to €1.6 billion, with margin down to 11.1% from 14.5% the previous year.

• Strategic actions included cost tightening, 75 net store closures, a 9% reduction in group operating expenses, and a focus on brand desirability to reignite growth.

• Strategic partnerships, notably with L'Oréal, and acquisitions like Raselli Franco, are set to accelerate growth in beauty and jewelry; the sale of Kering Beauté to L'Oréal is expected to close in H1 2026.

• Major management changes, including new creative leadership at key brands and a new Chief Commercial Officer, were implemented to drive channel synergies and creative renewal.

Financial highlights

• Recurring operating margin declined to 11.1% from 14.5% in 2024; recurring EBITDA was €3.7 billion, down 19% year-over-year.

• Free cash flow from operations was €4.4 billion, including €2.1 billion from real estate transactions; net financial debt reduced by €2.5 billion to €8 billion.

• Capex (excluding real estate) was €792 million, representing 5.4% of revenue.

• Dividend proposed at €3 per share, plus an exceptional €1 per share from the Kering Beauté disposal, subject to approval.

Outlook and guidance

• 2026 is expected to be a year of growth and margin improvement across all major brands, with a focus on sustainable brand strategies and a realistic, bottom-up budget.

• Store closures to continue, with at least 100 net closures planned for 2026 to improve sales density and profitability.

• Further deleveraging expected with the L'Oréal deal closing in H1 2026, targeting a leverage ratio of 1–1.5.

• Capital Markets Day in April 2026 will detail the roadmap for transformation and growth.