Ermenegildo Zegna Group, the parent company of Thom Browne, reported strong Q3 earnings, with its revenue rising by 20.8% year-on-year to €431 million.
The luxury fashion group registered double-digit growth across all of its key markets and observed a notable increase in demand in the U.S.
In the North American market, revenue was up 44.2% to €111 million as the company benefitted from its recent acquisition of the Tom Ford Fashion business, as well as significant direct-to-consumer (DTC) demand for ZEGNA and Thom Browne, both of which recorded double-digit revenue growth. Meanwhile, revenue in the EMEA region went up by 27.7% to €152 million during the quarter, while revenue in the Asia-Pacific (APAC) region increased by 3.5% to €158 million. The company saw an uptick in demand in the Latin America market, where revenue grew by 19.6% to €8.4 million.
Aside from growth in its DTC business, the company reported a 6.6% year-over-year increase in wholesale revenue, which reached €148 million during Q3. For the first nine months of the year, wholesale revenues reached €466 million, up 6.4% year-over-year and up 5.7% year-over-year on a constant currency basis. Overall, the wholesale business accounted for 34.9% of the company’s revenue, lower than 40.3% during the same period last year.
“Our results this quarter continue to showcase the broad-based strength of our three brands and the successful execution of our strategy,” said group chair and CEO Ermenegildo Zegna in a statement.
“I am particularly pleased that we are performing well across a diverse set of regions, as the balance of our geographic mix provides resilience in a highly dynamic environment,” Zegna said.
With a strong Q3 performance under its belt, the company said it is well positioned to meet its annual revenue target of more than €2 billion and for adjusted EBIT margin to reach at least 15%, excluding the Tom Ford Fashion segment.
Earlier this week, the company announced that it had executed an agreement with its South Korean franchise partner to acquire the entity that runs its ZEGNA business in the country. The deal gives the company the reigns to directly operate its business in South Korea starting Q1 2024. The company said it plans to turn its 15 existing ZEGNA stores into direct-to-consumer points of sale.
Photo credit: Ermenegildo Zegna