Prada Group CEO Andrea Guerra on Potential Growth as Sales Top 4B Euros
MILAN— The Prada Grouphit the 4 billion euro sales mark in the first nine months of the year, a performance that reflected 19 consecutive quarters of growth.
In the period ended Sept. 30, revenues rose 6 percent to 4.07 billion euros compared with 3.83 billion euros in the first nine months last year. At constant exchange rates, sales were up 9 percent.
While acknowledging the challenges and volatility of the current global scenario, the group’s chief executive officer Andrea Guerra sounded pleased with the performance during a call with analysts on Thursday at the end of trading in Hong Kong, where the company is publicly listed.
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“Our performance has been solid, on the same pace as last year, against very tough comps,” said Guerra. “Hopefully, we all know by now that we’re all working in a different world and a different industry. To continue with this rhythm after two years of the beginning of this new world means that we have been able to attract and please clients with our brands and products, considering the extent and duration of our like-for-like improvement during so many quarters now. It means that all the work we have been able to do so far, all the effort, all the commitment that we have put on our people, organization and retail excellence is finally beginning to really pay off and we are happy about this.”
In a statement, Patrizio Bertelli,Prada Group chairman and executive director, touted the consecutive and uninterrupted growth stretch. “The consistency of our results, in a complex macroeconomic environment, confirms the strength of our brands and the validity of our strategy,” he said. “We continue to focus on creativity, product excellence and craftsmanship as foundations for enduring relevance and long-term development. These principles guide us as we navigate an evolving landscape with confidence, discipline and responsibility.”
Performance by Brand
By brand, at constant exchange rates, Prada’s retail sales declined 1.6 percent to 2.53 billion euros over the nine-month period and edged down 0.8 percent in the third quarter.
Guerra described Prada’s performance as “resilient, with a twist,” reporting a negative sign in the second part of the second quarter and a “slow, continuous and steady improvement” in the initial part of the third quarter, “not helped by traffic. I would say that traffic is normalizing, leveling off, but we are really reaping benefits from all the work done on retail activities, brands, products, together with our people in the stores across the world.”
Miu Miu’s retail sales climbed 41 percent to 854 million euros, growing across categories and geographic markets. In the third quarter, Miu Miu was up 29 percent against comps of a 105 percent gain. The brand’s contribution to total sales increased to 32 percent compared with 25 percent in the same period last year.
He pointed out that while Miu Miu comps were “really impossible” to overtake, the quarter was another solid one, well-balanced between price points, mix, and across product categories and regions. “This is why I’m saying that the journey is continuing pretty solid.”
Both brands saw an acceleration in their leather goods categories, said Guerra.
Church’s was up 10 percent in the quarter, and sales of the storied footwear brand rose 6 percent to 23 million euros in the nine months.
Geographic Markets
Group retail sales in Asia-Pacific increased 7 percent (10 percent at constant exchange rates) to 1.21 billion euros.
Guerra said consumer spending had not changed much in the third quarter. “We have seen a kind of plateau in China. [Summer] holidays were better than what we expected, and the worst is over but I would keep the word plateau. I don’t think that we will ever see again in the near future what we have seen in the last decade. What we have observed was that we had less Americans in Europe, and obviously less influence on our performance in Europe.”
Chief financial officer Andrea Bonini said “all clusters were positive at group level in the nine months and in the third quarter, including the Chinese, with improvements quarter-on-quarter for Prada mainly driven by local transactions across all key regions, but the Chinese cluster is still negative.”
Europe was up 4 percent to 1.13 billion euros, supported by domestic and tourist spending.
Guerra and Bonini trumpeted “good progression” in the Americas, lifted by 11 percent growth in retail sales to 637 million euros, with a sequential acceleration in the third quarter. At constant exchange, the region posted a 15 percent increase.
Japan was up 2 percent to 474 million euros against exceptional high tourism in 2024, particularly in the first half, and the region improved in the third quarter, driven by solid local and increased tourist demand.
Guerra touted resilience in Japan, and said the group had been “a little bit more aggressive in changing behaviors, attitudes and culture” in North America, leading to strong reaction and an acceleration.
The executive cautioned that October had “very little meaning compared to the last six weeks of the year” defined as “paramount” for business.
The Middle East continued to grow in the nine months, posting an 18 percent gain to 182 million euros.
Creative Novelties
Guerra addressed the recent exceptional wave of debut collections by newly installed creative directors at several fashion brands in Milan and Paris.
“In the next three, six months, we will observe in our industry a lot of novelties, with all these new entries and products,” he said, underscoring how the group has also held its own during fashion weeks. “We were not a novelty, but we had our very similar fair share of contacts, gratitude, happiness and reactions to our shows. We are here, authentic, very committed to our creative leadership, to contemporary art, culture and craft. We will continue in our solid journey, continuing to invest in our creativity. We feel at home in this new normal, and we are starting to reap fruits from all our investments on deeper organization, processes and retail. Our flexibility and velocity will obviously continue to be one of our primary characteristics.”
Guerra added he hoped that all the changes in the next six months will allow the industry to benefit from more traffic, “which we would all love. I think that much of this is also going to help this industry to come back to being more desirable.”
Responding to a question about a potential shift in fashion trends, Guerra said he did “not see major pendulums. On the one hand, there are the shows, which allow people to express themselves, deliver the future and give their sense of that moment, and on the other hand, there is the world and life. And the two have to be connected. The two sides have to be in tension. What we think is proving to be very correct and very successful is people that are authentic to their history, to their cultural pillars and to their creative hearts.”
Beauty, Eyewear Potential
Following the recent deal between L’Oréal and Kering, one analyst asked if the Prada Group, whose beauty licensee is the former, would be open to considering an offer for the Giorgio Armani group and manage the fashion division if L’Oréal were to acquire it, similarly to what Estée Lauder did with Zegna and Tom Ford.
“We were not invited,” said Guerra with a chuckle and a dig, referring to the fact that Armani’s will indicated the giant beauty company, LVMH Moët Hennessy Louis Vuitton and EssilorLuxottica were to be considered as potential investors in his namesake group. “We have always been looking to the world and the brands, and have great respect for that brand, but I would not consider this question realistic today.”
When another analyst brought up that L’Oréal CEO Nicolas Hieronimus said Prada fragrance and beauty crossed the 500 million euro mark four years after joining L’Oréal Luxe and that the Yves Saint Laurent beauty business has sales close to 3 billion euros, Guerra admitted the group had come to the beauty market late, but that it was “gaining huge ground” with the launch of Paradigme, the new men’s fragrance, fronted by Tom Holland.
“It’s been a real hit and a real success. We’re very happy with the partnership with L’Oréal. We are constantly growing, but we are not in a hurry, luxury is patience and we love the work we’re doing together, it’s going to be a long journey of growth together.”
He also touted the launch of the first Miu Miu fragrance under license with L’Oréal, Miutine, fronted by Emma Corrin, saying it was “a great success,” deflecting questions about the size the group’s beauty business could achieve.
Responding to one analyst who believed the closing of the Versace deal was complete, Guerra clarified that the transaction is not closed. He added that “hopefully it will be so in the next 15 days.”
EssilorLuxottica is also a Prada licensee, and while staying mum about future launches, asked about the eyewear company’s introduction of smart glasses, Guerra responded that “Prada has always been at the forefront of innovation, and we will continue to be through all our partnerships, and obviously our partnership with Luxottica is paramount.”
Asked about pricing, Guerra said his “philosophy is not changing,” aiming to be “very solid on our entry price, which does not mean to reduce it, but to keep it credible.” Also, he believes in merchandising activities with an eye on architecture and the arts. “We need to understand season by season, how we can move from one to another, how we can insert some new products, and how can we move in the middle level, upward.”
The executive also believes more can be done in the high-end range of the spectrum, where “we have not been serious enough and maybe not courageous enough sometimes, but where we are credible.”
As an example, he said Prada’s newly high jewelry collection, “Couleur Vivante,” was presented in New York last week and the success was such that “somehow also surprised many of us. The thing is, we have to be more bold, we have to be more serious, because the consumer is ready for us at those price levels, and we have to deliver. We are very proud of this collection and we will now tour the most important cities in the next three, four months with it.”
Price increases in 2026 will be aligned with the recent past, in two moments of the year.
Bonini said exchange rates had a negative impact on group revenues of around 260 basis points during the first nine months, and 270 basis points over the quarter. “The impact is expected to be even more meaningful in the fourth quarter.”
In the nine months, the retail channel was up 6 percent to 3.64 billion euros, driven by like-for-like and full-price sales.
At constant exchange, the channel was up 9.3 percent and in the third quarter it reported 7.6 growth, in line with the second quarter and against a challenging 18 percent gain in the prior-year period.
Wholesale revenues rose 3 percent to 322 million euros and royalties were up 11 percent to 101 million euros.
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