Prada sales jumped as the Italian fashion group continued to see strong growth amid a wider slowdown in the luxury industry.
Net revenue in the first half grew 17 per cent at constant exchange rates, Prada said in a statement on Tuesday (Jul 30). That was in line with analyst estimates.
Prada has been outperforming its high-end fashion rivals thanks to the success of its products among Gen-Z consumers and extraordinary growth rates at sister label Miu Miu, where retail sales jumped 95 per cent in the second quarter.
During the period, Miu Miu and Prada were in the top three “hottest” names in a ranking compiled by Lyst Index, which tracks searches and social media mentions for brands and products.
In the ranking, Lyst also highlighted a Prada ad campaign featuring actress Scarlett Johansson, which has drawn more than 6 million YouTube views.
Miu Miu now represents just under a quarter of total retail sales at the group, with Prada making up three quarters.
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Prada’s Japan retail sales jumped 65 per cent in the second quarter, helped by strong tourism flows. The country has been a favourite destination for Chinese customers taking advantage of the weak yen to pick up pricey goods during visits to the country. Asia Pacific, which includes the crucial China market, grew 8 per cent during the period.
In a call with analysts, chief executive officer Andrea Guerra said demand from customers in China has become more difficult in the past month, although their consumption outside China has become “easier.”
The results on Tuesday mark a stark contrast with a mostly weak earnings season for luxury brands, pointing to a clear slowdown in demand.
Hermès International SCA has recently outperformed industry leader LVMH Moët Hennessy Louis Vuitton as well as Gucci owner Kering, in a sign that the wealthiest consumers haven’t cut back as much as so-called aspirational clients, who are more likely to curb spending amid inflation worries.
Shares of Hong Kong-listed Prada have gained about 20 per cent so far this year. BLOOMBERG
