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Investing.com -- Ermenegildo Zegna (NYSE:ZGN) reported first-half (H1) revenue that missed analyst expectations, pushing its shares down nearly 4% in U.S. premarket trading.
The Italian luxury house posted H1 revenue of €927.7 million, down 3.4% year-on-year and below the €941 million analyst estimate.
On an organic basis, revenue declined 2%, as growth in direct-to-consumer (DTC) sales was offset by a sharp drop in wholesale.
DTC revenue rose 4% year-on-year and 6% organically, while wholesale branded revenue fell 27%, reflecting the company’s ongoing strategy to reduce reliance on that channel.
Second-quarter revenue came in at €468.9 million, a 6% decline from the previous year, or 3% lower on an organic basis. The group said currency headwinds, particularly from a stronger euro versus the U.S. dollar and Renminbi, weighed on performance.
By brand, Zegna’s Q2 revenue slipped 2% year-on-year but rose 2% organically, with DTC growth accelerating to 7% on an organic basis. DTC performance was also strong at Thom Browne and Tom Ford Fashion, with organic growth of 7% and 11% respectively.
Regionally, the Americas led growth in the quarter, the company said, with revenue rising 4% year-on-year and 10% organically.
Zegna also announced a leadership change at Thom Browne, with Sam Lobban set to take over as CEO on September 2, following Rodrigo Bazan’s departure at the end of August.
"I welcome Sam Lobban as the brand’s new CEO," said Ermenegildo “Gildo” Zegna, Chairman and CEO of the Ermenegildo Zegna Group.
"With his extensive background in merchandising and customer-first mindset, Sam is exceptionally well-suited to lead this brand in capturing its unexpressed potential."