Dive Brief:
- Prada Group net revenues rose 13% to 4.7 billion euros, or approximately $5.2 billion at current exchange rates, for the 2023 fiscal year, the company reported Thursday.
- By region, Japan saw the strongest growth in 2023 at 44% year-over-year versus fiscal 2022. The company credited the rise mainly to local customers aided by an increased tourist presence. Sales in Europe, the Middle East and the Asia Pacific region all grew, though performance dipped in the Americas by 2%. The company said Europe was up due to “strong domestic and tourist spending” while the Middle East region rose “despite the intensified geopolitical headwinds.”
- Miu Miu saw a retail sales increase of 58% year over year with an 82% increase in Q4, according to the company, which only reports individual brand sales on a constant currency exchange rate basis. The Prada brand saw a retail sales uptick of 12% year over year, including 10% growth in Q4.
Dive Insight:
Prada Group sales continue to flourish while some of its competitors in the luxury space struggle. Lanvin Group saw a modest 1% year-over-year rise in 2023 and a 7% dip for its namesake brand, while Kering’s 2023 revenues dipped 4% last year and Burberry issued an early profit warning in January ahead of its full fiscal 2023 results, which will come in May.
Prada's upbeat results are similar to other luxury companies including LVMH, Richemont, Hermès, Zegna, signaling that the economic headwinds impacting the sector are uneven.
Group revenue increases have slowed somewhat since a 62% profit jump in H1, but kept pace with the 12% uptick posted for the first nine months of the year.
“We have successfully delivered on our ambitions in 2023, with excellent performance achieved consistently through the year, as brand desirability grows stronger fuelled by a combination of product, communication, and retail initiatives,” Andrea Guerra, Prada Group’s CEO, said in a statement. “Retail productivity and profitability improved for the third consecutive year, thanks to once again strong double digit, like-for-like growth.”
A new beauty license for Miu Miu, signed in February, may help the company expand on the line’s success. In 2023, the brand was named the buzziest label for the second year in a row by shopping app Lyst. The ranking was due in part to the popularity of Miu Miu’s popular ballet flats and logo cashmere cardigans, which Lyst said led to “a new librarian-core fashion era.”
Meanwhile, the Prada brand rose to the top of Lyst’s rankings for Q4 2023, driven by a star-studded holiday advertising campaign.
Guerra said the company is aware of both the high bar recent earnings have set and “persisting macro and geopolitical uncertainties,” adding the company’s priority for 2024 was to continue pushing brand desirability and retail performance.
“As with 2023, while quarterly growth trajectory may not be linear through the year, we retain our firm ambition of delivering solid, sustainable, above-market growth,” Guerra said.
Prada Group first began releasing quarterly data in May 2023, when it posted a net revenue of 1.06 billion euros, showing a 22% year-over-year increase.
