Kering stock experienced a sharp decline of 11% on March 14, 2025, following the announcement of Demna Gvasalia as the new artistic director of Gucci, effective mid-2025. Analysts reacted negatively, revealing a growing divide between financial experts and luxury decision-makers. The appointment surprised many, as Gvasalia, previously at Balenciaga, has been a figure of controversy in recent years.
The fall in stock value illustrated the financial community's skepticism regarding Gvasalia's ability to revitalize Gucci, which has struggled with market desirability. Previous creative director Sabato de Sarno, who departed in February 2025 after a brief two-year tenure, failed to reignite the brand’s sales despite attempts to modernize its image. Analysts noted de Sarno's style didn't resonate strongly, leading to significant losses in Gucci’s market position.
Royal Bank of Canada had previously described de Sarno's exit as unsurprising due to these market share losses. The luxury industry has also seen increasing criticism of the financial sector's influence over creative decisions, with some industry insiders arguing that this emphasis on financial metrics hampers true artistic expression.
As major fashion outlets weighed in, opinions diverged on Gvasalia's suitability for the role. Highsnobiety claimed Gvasalia's recruitment was a much-needed change for Gucci, which requires fresh vision and creativity. Vogue France echoed this sentiment, calling Gvasalia one of the most original and innovative designers of the current era, suggesting he could rejuvenate the brand's identity.
Conversely, Zuzanna Pusz of UBS stated it was evident the market had anticipated a different kind of high-profile hire, leading to disappointment among investors. Meanwhile, J.P. Morgan's analyst noted the controversial nature of Gvasalia's past decisions could present challenges moving forward.
Bernstein offered a more cautious view, giving the appointment a lukewarm rating of 5 out of 10, stating uncertainty loomed over Gucci's future direction. Despite the stock's current valuation hovering around 220 euros, Bernstein has set a price target of 250 euros, marking only a modest potential growth path from current levels.
Tensions mount as the fashion world classifies Gvasalia's appointment as either a promising opportunity or a potential risk. The contrast between high fashion's creative ambitions and the expectations of financial analysts continues to generate dialogue about the future of luxury brands in a market increasingly leaning towards analytical perspectives.
Navigating through this turbulent landscape, Kering will face significant scrutiny as Gvasalia's influence unfolds in the upcoming Gucci collections, especially with the Milan Fashion Week illustrating the true impact of this bold decision. Will Demna Gvasalia deliver the renaissance Gucci desperately needs, or will he contribute to persistent pitfalls that have plagued the brand in recent years? Stakeholders across the luxury sector await what the future holds, marking this critical era for Kering and Gucci as they adapt to a fast-evolving marketplace.
