Become a Vogue Business Member to receive unlimited access to Member-only reporting and insights, our Beauty and TikTok Trend Trackers, Member-only newsletters and exclusive event invitations.
Hugo Boss said its first-quarter performance was hit by macroeconomic uncertainty, but it maintained a tight focus on the things it can control, including cutting costs. As a result, its group sales decline was less severe than it originally forecast — falling 2 per cent year-on-year (currency adjusted) to €999 million.
“Following a strong finish to 2024 [sales were up 6 per cent in Q4], our performance in the first quarter of 2025 was affected by the rising macroeconomic uncertainty, which impacted global consumer sentiment and our industry. Against this backdrop, we continued to place strong emphasis on what we have in our control,” said CEO Daniel Grieder in a statement, referencing the brand’s “most impactful” strategic initiatives such as its campaign with David Beckham and cost efficiencies across sourcing.
EBIT dropped 12 per cent year-on-year to €61 million, while EBIT margin decreased 70 basis points. Gross margin was stable in Q1, at 61.4 per cent, and operating expenses also remained at the same level as Q1 last year (though as a percentage of sales, operating expenses increased by 60 basis points).
Hugo Boss confirmed its cautious 2025 outlook despite the macroeconomic and trade uncertainty: the company expects sales to remain broadly flat this year, sitting between -2 per cent and +2 per cent (between €4.2 billion and €4.4 billion), with EBIT to increase between 5 and 22 per cent with a margin of 9 to 10 per cent.
Most luxury players reported a deceleration in the first quarter of 2025. While top performing brands like Hermès, Brunello Cucinelli and Bottega Veneta are still in growth, Prada’s sales were flat, though Miu Miu still shined with 60 per cent growth. Gucci’s slump continues, dragging down Kering’s overall performance. LVMH, which missed expectations in Q1, fell somewhere in the middle.
“Hugo Boss’s Q1 results are a positive surprise, with sales a 3 per cent beat versus consensus and EBIT even a 22 per cent beat. Currency-adjusted sales decline in Q1 was only 2 per cent [management spoke about a mid-single-digit percentage decline in the FY24 results call],” said Deutsche Bank analysts Michael Kuhn and Adam Cochrane in a note.
By brand, Boss womenswear sales dipped 1 per cent, while Boss menswear and Hugo sales were each down 2 per cent. Sales through licences grew 10 per cent, with improvements across fragrance, watches and eyewear. Digital sales led the way with 4 per cent growth across brands, partially offsetting declines in bricks-and-mortar retail and wholesale, of -4 per cent and -3 per cent, respectively.
In EMEA (Europe, the Middle East and Africa), revenues slipped by 1 per cent year-on-year, driven by falls in key markets like the UK and France. Revenue in the Americas was also down 1 per cent, reflecting a “moderate” sales decline in the US market as subdued demand from both domestic consumers and international tourists led to softer mall and store traffic. Latin America was the bright spot, maintaining double-digit growth.
Revenues dropped 8 per cent in Asia due to ongoing subdued demand in China, though sales in Southeast Asia and Asia-Pacific were up slightly and Japan achieved double-digit growth.
2025 will be the final year of Hugo Boss’s ‘Claim 5’ strategy, which Grieder introduced in 2021 upon joining the brand, and details five pillars to turn around its performance, including rebalancing omnichannel.
“We remain committed to balancing strategic investments with disciplined cost management to further drive brand momentum and profitability throughout the year,” said Grieder. “At the same time, we are closely monitoring macroeconomic developments and remain vigilant in light of the elevated global uncertainties, including the current tariff discussions. Thanks to our flexible sourcing set-up and our strong operational backbone, we are strategically positioned to adapt effectively to potential trade-related developments.”
Comments, questions or feedback? Email us at feedback@voguebusiness.com.
More from this author:
The Vogue Business Funding Tracker
