Hugo Boss had tough Q3, annual profit to hit guidance but at lower end

Hugo Boss’s Q3 numbers that have been launched on Tuesday contained quite a lot of negatives but the corporate remained upbeat total. It noticed a 1% fixed foreign money gross sales dip in Q3, the German trend big mentioned, because it cited “persistently challenging market conditions”.

“Macroeconomic headwinds and subdued consumer sentiment weighed on global industry development, particularly impacting the performance in key markets such as the UK and China,” it defined.

But it additionally mentioned it continued its execution of “strategic initiatives” which are strengthening model relevance, together with the profitable launch of AW25 collections and its Boss SS26 Fashion Show.

So what occurred in Q3? Total group gross sales on a reported foundation fell 4% to €989 million. By model, Boss Menswear was flat on a currency-adjusted foundation and down 3% reported at €764 million. Boss Womenswear fell 9% currency-adjusted and 10% reported to €67 million. And Hugo was down 5% currency-adjusted and seven% reported at €158 million.

The firm noticed a 3% currency-adjusted gross sales enchancment within the Americas that “largely compensate[d] for moderate revenue declines” in EMEA (down 2%) and Asia/Pacific (down 4%). But whereas these currency-adjusted figures do not look too dangerous, on a reported foundation the Americas fell 3% to €223 million whereas EMEA was down 3% at €641 million and Asia pacific was down 9% at €101 million. Licenses fell 14% on each a currency-adjusted and reported foundation to €25 million.

Clearly change price fluctuations had an enormous detrimental impression through the quarter.

But it noticed “sustained growth in digital” (+2% currency-adjusted and +1% reported at €201 million) and “sequential improvements” in bodily shops the place gross sales have been flat currency-adjusted and down 3% reported at €483 million. The decline in bodily wholesale of 5% currency-adjusted and seven% reported to €281 million mirrored the timing of deliveries.

But the gross margin improved by 100 foundation factors in Q3, primarily due to effectivity positive factors in sourcing and lower freight-cost ranges. And working bills declined by 3%, “reflecting ongoing strict cost discipline and additional efficiency gains”.

Profits outlook

Profits-wise, EBIT was “largely stable” though that doesn’t imply there was no motion because it was down 1% in contrast to a 1% rise for the yr to date.

As for the outlook, the corporate confirmed its top- and bottom-line guidance for 2025. In line with market expectations, group gross sales and EBIT are anticipated to “align with the lower end of guidance ranges”. Those ranges embody gross sales of between €4.2 billion and €4.4 billion, with EBIT starting from €380 million-€440 million, “due to heightened macroeconomic volatility and significant currency headwinds”.

It added that model and product initiatives akin to the most recent Beckham x Boss assortment launch mixed with ongoing effectivity measures in sourcing, gross sales, and administration are “expected to support Q4 top- and bottom-line performance”.

CEO Daniel Grieder mentioned: “Despite ongoing global market volatility in Q3, we remained focused on our strategic priorities, emphasising long-term brand strength over short-term gains. In this context, we are particularly encouraged by the sequential improvement in our direct-to-consumer business, as both digital sales and retail improved slightly. At the same time, we achieved meaningful efficiency gains, delivering notable gross margin expansion and streamlined expenses. This is clear evidence of the operational excellence and resilience at the core of our business model.”