MILAN — The Zegna and Tom Ford Fashion brands, a strong direct-to-consumer business, and a solid performance in the Americas helped offset a decline in the first quarter of the year at Ermenegildo Zegna Group’s wholesale business — a strategy orchestrated particularly for the Thom Browne brand.
Group revenues in the first three months ended March 31 amounted to 458.8 million euros, a 1 percent decline compared with 463.1 million euros in the same period last year.
“We are encouraged by these early positive results but also mindful of the recent geopolitical and economic uncertainties,” chairman and chief executive officer Gildo Zegna, who did not participate in a call with analysts on Thursday about the results, said in a statement. “And while we have not observed significant changes in customers’ behavior across our brands, we remain vigilant, agile and focused on our strategic priorities knowing that what truly matters is the strength of our brands and our unwavering commitment to staying close to our customers.”
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By brand, Zegna sales rose 3.6 percent to 293 million euros, driven by double-digit growth in the DTC channel, particularly in the Americas and the Europe, Middle East and Africa region.
Thom Browne revenues fell 18.9 percent to 64.2 million euros, impacted by the streamlining of its wholesale channel. For the year, wholesale is expected to be down 25 to 30 percent, “as we are mindful of protecting the brand,” said Gianluca Tagliabue, the group’s chief financial and chief operating officer, during the call.
Tom Ford Fashion sales gained 3.8 percent to 67.4 million euros, boosted by 10 percent growth in DTC “demonstrating improving momentum, especially in the U.S. and Europe and supported by the positive reception of Haider Ackermann’s first fashion show in March, which had a halo effect that drove additional traffic to stores and supported demand especially in the womenswear collection,” said Paola Durante, chief of external relations.
While “no revolution” is taking place in the brand’s pricing architecture, “higher ticket items” are expected at Tom Ford Fashion, she said responding to an analyst. Ackermann was named creative director of the brand last September, succeeding Peter Hawkings. He showed his first women’s and men’s collections for the brand for fall 2025 in March during Paris Fashion Week.
Sales of the textile division fell 10 percent to 29.9 million euros, reflecting a reduction in orders from brands outside the group.
In the first quarter, the Europe, Middle East and Africa region recorded group revenues of 154.1 million euros, slipping 1.6 percent and accounting for 34 percent of the total, boosted by double- digit growth at Zegna and Tom Ford Fashion.
Sales in the Americas amounted to 125 million euros, up 9.5 percent and representing 27 percent of the total, boosted by strong double-digit growth at Zegna, particularly in the U.S. The region, said Durante, was “the best” for all three brands, followed by Asia-Pacific. Japan and Singapore were particularly strong in the quarter, she said. Thom Browne is opening a store on Melrose Place in Los Angeles this week, Tagliabue said.
Responding to a question, he said no changes in the performance in America and “no areas of softness” had been seen since the end of the first quarter. “On the contrary, there have been improvements.” He cited New York as the “epicenter of big numbers” in the U.S., but also ticked off Florida and Southern California as drivers.
Asked about U.S. President Donald Trump’s 10 percent tariffs for goods imported into the U.S., Tagliabue said “we will take all the necessary actions to protect our EBIT [earnings before interest and taxes],” which will lead to a midsingle-digit increase in prices in the U.S., adjusting with the fall collections. “We are not moving manufacturing activities to the U.S., it’s not feasible, and we are not changing our sourcing strategy, mostly in Italy,” the executive said.
“We are taking advantage of a window [before the tariffs are implemented] to push deliveries by early July,” he said when asked about the fall Ackermann collection for Tom Ford Fashion, which will be delivered starting at the end of May.
Revenues in the Greater China region decreased 11.6 percent to 123.3 million euros, representing 27 percent of the total, reflecting the soft consumer environment affecting all three brands, in Hong Kong in particular.
Durante said the outlook for Greater China remains “prudent,” but that the “initial actions [taken by the group] are “paying off, especially for Zegna. We are positioned to be ready [in a recovery] but the region will still be negative in the year, while softer negative, less steep.”
In the first quarter, sales in the rest of Asia-Pacific were up 6.5 percent to 55.9 million euros, boosted by solid growth in particular in Japan for all three brands.
Tagliabue confirmed the group’s guidance for low-single-digit growth in EBIT for the year to between 185 million and 190 million euros.
Asked about the strategy behind operating expenses, he said, “We are keeping our priorities, for the long-term health of the brands, but there is wiggle room to manoeuvre to defend the bottom line without hurting the trajectory. We are actually doubling down” on some projects, citing, for example, decamping to Dubai to stage the Zegna spring show in June.
In the first quarter, DTC revenues totaled 345.1 million euros, representing 81 percent of the group’s branded product revenues.
Zegna’s DTC revenues amounted to 250.8 million euros, up 4.7 percent, largely driven by solid growth from existing stores. The Greater China region remained negative, in line with the trend from the last quarter of 2024. As of March 31, Zegna had 283 directly operated stores, with two net openings in the quarter, including in Riyadh Solitaire, Saudi Arabia.
Thom Browne DTC revenues totaled 46.3 million euros, up 3.5 percent on the same period last year, boosted by new store openings and by solid double-digit growth in Japan and South Korea. There are 117 Thom Browne directly operated stores, and one store opened in the quarter in Palm Beach, Fla.
Tom Ford Fashion DTC revenues totaled 48.1 million euros, a 10 percent gain driven by solid growth across all regions. At the end of March, the brand had 65 directly operated stores, with one opening in the quarter in Puerto Banus, Marbella, Spain.
In the first quarter, wholesale branded revenues totaled 79.5 million euros, compared to 99.1 million euros in the same period last year, a 19.8 percent decline.
Zegna’s wholesale revenues were down 2.6 percent to 42.1 million euros, impacted by the decision to convert some wholesale shops-in-shop into retail concessions, for example at Saks and Harry Rosen, among others.
Thom Browne wholesale revenues fell 48 percent to 17.9 million euros, reflecting the streamlining of the channel, a different timing of deliveries and wholesale shops-in-shop conversions into retail concessions.
Tom Ford Fashion wholesale revenues decreased 8.9 percent to 19.4 million euros, also reflecting the conversion of shops-in-shop into retail concessions and cautious spring 2025 orders, the last season before the launch of Ackermann’s collections for fall 2025.
Tagliabue said Zegna and Tom Ford’s wholesale sales would remain negative in the year, but that from 2026 the channel would “not be a major driving factor.”