Ralph Lauren Warns Resurgence in Virus Cases Could Derail Recovery

Ralph Lauren Warns Resurgence in Virus Cases Could Derail Recovery
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Ralph Lauren Warns Resurgence in Virus Cases Could Derail Recovery

Ralph Lauren Warns Resurgence in Virus Cases Could Derail Recovery

Ralph Lauren Corp warned on Thursday that a new wave of COVID-19 cases could hurt its sales recovery in North America and Europe, with consumer demand likely to be pressured for the rest of the year.

Ralph Lauren's shares fell 7%, taking the yearly losses to over 40%, as the company also missed second-quarter sales estimates.

The health crisis has bruised sales of luxury goods companies, which have traditionally avoided online sales, as shoppers resisted visiting physical retail locations even after lockdowns were eased.

"There is a high degree of uncertainty surrounding the second wave of shutdowns... biggest potential threat to our second half recovery," Chief Financial Officer Jane Nielsen said.

"Given the announcements of what we saw in Europe, particularly in France and Germany, and the rising case count in North America, we're not guiding for when we will return to pre-COVID levels."

Germany and France, two huge markets for luxury fashion, on Wednesday ordered their economies back into lockdown, as a massive second wave of coronavirus infections threatened to overwhelm Europe before the winters.

However, Ralph Lauren's sales are rising in China as the country's wealthy shop more online and at local stores.

China's growth could not offset the slump in demand in other parts of the world. Ralph Lauren reported a 30% drop in second-quarter net revenue to $1.19 billion, missing estimates of $1.21 billion, according to IBES data from Refinitiv.



Struggling Gucci Owner’s Shares Soar Over New CEO Reports 

A model presents a creation by the Gucci Fall-Winter 2025/2026 collection during Fashion Week in Milan, Italy, February 25, 2025. (Reuters)
A model presents a creation by the Gucci Fall-Winter 2025/2026 collection during Fashion Week in Milan, Italy, February 25, 2025. (Reuters)
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Struggling Gucci Owner’s Shares Soar Over New CEO Reports 

A model presents a creation by the Gucci Fall-Winter 2025/2026 collection during Fashion Week in Milan, Italy, February 25, 2025. (Reuters)
A model presents a creation by the Gucci Fall-Winter 2025/2026 collection during Fashion Week in Milan, Italy, February 25, 2025. (Reuters)

Shares in Gucci owner Kering jumped Monday over reports that the outgoing boss of French automaker Renault would take over as chief executive of the struggling luxury group.

Renault shares, however, fell following its announcement Sunday that Luca de Meo, 58, would step down on July 15 "to take on new challenges outside the automobile sector" after five years at the helm of the company.

Le Figaro newspaper reported that de Meo would take over at Kering, the French luxury group that owns Gucci, Yves Saint Laurent, Balenciaga and other premium brands.

Kering has struggled to turn things around at Gucci, the Italian fashion house famous for its handbags and which accounts for half of the group's overall sales.

Previous reports have said the group's chief executive Francois-Henri Pinault would stay on as chairman of the group in a management shake-up.

Kering shares rose more than six percent to 183 euros ($212) in morning deals at the Paris stock exchange.

Shares in Renault fell 6.7 percent to 40.10 euros.

Known as a skilled communicator and marketing expert, de Meo is credited with bringing stability to a company that was in turmoil when he took over in 2020.

The automaker was reeling from more than a year of crisis in the wake of the scandal involving Carlos Ghosn, the former head of the Nissan-Renault alliance who fled Japan to avoid trial.

De Meo accelerated the group's shift to electric vehicles and pushed for an upmarket move in an effort to steer the company out of trouble. Renault also owns the Dacia, Alpine, and Lada brands.