Shares in French luxury group Kering rose on Wednesday as investors reacted positively to the company’s leadership changes and new strategic direction aimed at reviving growth. The uptick came despite weak second-quarter results, particularly from Gucci.

Following this week’s disappointing first-half earnings, which included a 46% drop in net profit and further setbacks at Gucci, investors appear to be looking beyond near-term challenges and focusing on the group’s long-term recovery efforts.

“The market is trying to look forward and anticipate future improvements,” said Bernstein analyst Luca Solca, noting a sense of growing investor optimism. Kering reported a 15% decline in group revenue for the second quarter, falling short of analyst expectations. Still, its stock rose about 5% by 9:30 a.m. GMT, making it one of the top-performing blue-chip stocks on the Paris exchange.

To address sliding sales and rising debt, Kering announced the appointment of Luca de Meo—former CEO of Renault—as its new chief executive, effective 15 September. De Meo will be the first external leader to head the group, which remains under the control of the billionaire Pinault family. François-Henri Pinault will continue to serve as chairman.

As part of its broader turnaround strategy, Kering has also named Demna as Gucci’s new creative director. The designer is expected to introduce a new collection format in September, with a full runway debut planned for March 2026.

“The market will likely shift focus to continued cost discipline, the imminent arrival of new CEO Luca de Meo, and another attempt at relaunching Gucci,” said Citi analyst Thomas Chauvet.

Despite a 25% year-over-year drop in Gucci’s second-quarter sales to €1.46 billion ($1.69 billion), Kering signaled early signs of improvement heading into the third quarter. UBS analysts noted stabilization, citing stronger retail performance and effective cost control. They also indicated that their earnings forecasts would remain unchanged “for the first time in a while.”

“Although there is still a lot of uncertainty and work ahead, the first half left us feeling somewhat more positive,” UBS said.

($1 = 0.8657 euros)

FashionNetwork.com with Reuters