Ferragamo Q1 2025 presentation: Mixed results amid strategic product focus

Introduction & Market Context

Salvatore Ferragamo SpA (BIT:SFER) presented its Q1 2025 revenue update on May 14, 2025, revealing a slight overall revenue decline amid varying performance across regions and product categories. The luxury fashion house reported total revenue of €221 million, down 2.6% year-over-year, or 1.0% at constant exchange rates.

The company acknowledged operating in a "difficult macroeconomic environment" with "increasingly uncertain scenario," highlighting its focus on flexibility and operational discipline. Ferragamo’s stock closed at €6.14 on the day of the presentation, down 1.47%.

Quarterly Performance Highlights

Ferragamo’s Q1 2025 results showed divergent performance across distribution channels. Direct-to-consumer (DTC) sales, which account for 74% of total revenue, declined by 3.6% (or 4.5% at constant exchange rates) to €164 million. However, wholesale revenue grew by 7.9% (10.3% at constant FX) to €54 million, partially offsetting the DTC weakness.

As shown in the following chart of revenue by distribution channel:

The company’s product category performance revealed a significant shift in consumer preferences. Leather goods and handbags, representing 44% of net sales, showed strong growth of 9.8% at constant exchange rates. Meanwhile, shoes, traditionally Ferragamo’s core category accounting for 42% of sales, declined by 10.1% at constant FX.

The following breakdown illustrates this product category shift:

Regional and Product Category Analysis

Ferragamo’s regional performance painted a complex picture of its global operations. The Asia-Pacific region, which accounts for 29% of net sales, experienced a substantial decline of 13.7% at constant exchange rates. This contrasted sharply with growth in other regions, particularly Latin America (+12.2%) and EMEA (+8.3%).

The following regional breakdown shows these disparities:

The company’s directly operated store network contracted slightly to 362 locations as of March 31, 2025, down from 371 a year earlier. This reduction aligns with the company’s strategic focus on optimizing its retail footprint.

The global distribution of Ferragamo’s store network is illustrated here:

Strategic Initiatives

Ferragamo emphasized its focus on core product categories, particularly shoes and bags, while enriching its assortment with different price points and functions. The company highlighted its main advertising campaigns for Pre-Spring and Spring/Summer 2025, showcasing this product-centric approach.

The following image displays key elements of Ferragamo’s Pre-Spring 2025 campaign:

Additionally, the Spring/Summer 2025 campaign further reinforces the focus on core categories:

The company also received positive feedback for its Fall/Winter 2025 Fashion Show, which was ranked as the Best Show in Milan by WWD Japan. The presentation highlighted a strong impression score of 9.2 and favorable reviews for men’s tailoring and the new "hug bag."

The fashion show feedback is summarized in this image:

Ferragamo is also investing in enhancing the in-store experience with new store concepts in key Asian markets, including Osaka, Taipei, Seoul, and Nagoya. These renovations aim to elevate the customer journey and strengthen the brand’s retail presence in important luxury markets.

Forward-Looking Statements

Looking ahead, Ferragamo indicated it would continue updating its product offerings to align more closely with customer desires while strengthening its market position. The company emphasized leveraging its "strong DNA and creative capabilities" while maintaining flexibility and operational discipline in an uncertain market environment.

The focus on core categories (shoes and bags) suggests Ferragamo is returning to its heritage strengths while adapting to shifting consumer preferences, particularly the growing demand for leather goods over footwear. The company’s wholesale channel growth may indicate a strategic shift in distribution approach as it navigates challenging retail conditions.

Despite the overall revenue decline, Ferragamo’s growth in most regions outside APAC and in leather goods demonstrates resilience in certain segments of its business. The company’s strategic initiatives around product focus, store experience enhancement, and distribution optimization will be key to navigating the uncertain luxury market environment in the remainder of 2025.

Full presentation:

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