Italy's Zegna sees strong DTC momentum despite modest Q1 revenue drop
The direct-to-consumer (DTC) channel remained the group's growth engine, rising 5.2 per cent YoY to €345.1 million (~$368.4 million) and representing 81 per cent of branded product revenues. The wholesale revenues of the group dropped sharply by 19.8 per cent YoY to €79.5 million, down 19.4 per cent organic.
Ermenegildo Zegna Group has reported revenues of €458.8 million (~$489.5 million) in Q1 2025, down 0.9 per cent YoY. Strong DTC growth of 5.2 per cent offset wholesale decline. Zegna and Tom Ford Fashion brands led gains, while Thom Browne saw declines. Americas grew 9.5 per cent but Greater China Region saw 11.6 per cent decline. The Group expanded its DTC footprint to 465 stores globally.
Revenues for the Zegna segment in Q1 2025, which includes the Zegna brand, Textile, and other revenues—amounted to €333.3 million, up 2.6 per cent YoY, and up 2.2 per cent organic, Zegna Group said in a press release.
Zegna brand revenues in the quarter stood at €292.9 million, an increase of 3.6 per cent YoY, and organic increase of 3.1 per cent, driven by solid growth in the DTC channel.
Meanwhile, Tom Ford Fashion also saw a steady rise, with revenues reaching €67.5 million, up 3.8 per cent YoY, driven by a 10 per cent YoY DTC surge and heightened interest following Haider Ackermann's March fashion show.
The textile segment recorded revenues of €29.9 million the quarter, down 10.0 per cent YoY, and organic decline of 9.3 per cent, reflecting a reduction in orders from brands outside the group.
Other revenues, which mainly include revenues from sales to third-party brands, were €4.3 million in Q1 2025, compared to €2.8 million in Q1 2024, an increase of 52 per cent YoY, organically up 51.2 per cent, positively affected by different timing in deliveries.
Regionally, the Americas outperformed, delivering a 9.5 per cent revenue increase to €125.0 million (+8.9 per cent organic), accounting for 27 per cent of total group sales.
In contrast, the Greater China Region (GCR) remained challenged, with revenues down 11.6 per cent YoY (-12.4 per cent organic) to €123.3 million. The subdued luxury consumer environment and soft footfall in malls impacted all three brands.
Europe, Middle East, and Africa (EMEA) generated €154.1 million in revenue, down 1.6 per cent YoY, with solid Zegna and Tom Ford Fashion performance countered by a Thom Browne dip. Meanwhile, the rest of Asia Pacific (APAC) region posted 6.5 per cent growth, led by Japan's retail strength.
As of March 3, 2025, the group operated 465 directly managed monobrand stores across Zegna, Thom Browne and Tom Ford Fashion, up from 417. The expansion supports the Group's growing emphasis on DTC, with store openings in Saudi Arabia, Spain, and the US, added the release.
'Despite the ongoing challenges in our sector, all our three brands have reported positive performance in the strategic DTC channel. We are encouraged by these early positive results but also mindful of the recent geopolitical and economic uncertainties. And while we have not observed significant changes in customers' behaviour across our brands, we remain vigilant, agile, and focused on our strategic priorities knowing that what truly matters is the strength of our brands and our unwavering commitment to staying close to our customers,' said Ermenegildo 'Gildo' Zegna, chairman and chief executive officer (CEO) of the Group.
Fibre2Fashion News Desk (SG)
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