Dive Brief:
- Hugo Boss reported a group sales increase to 1.03 billion euros, or approximately $1.09 billion at current exchange rates, in its Thursday Q3 earnings release. That represents a 10% rise from 933 million euros for the same period last year.
- Sales grew double-digits across every region, including a 16% Q3 growth in the Americas, which the company attributed to strong sales in the U.S. market “with all consumer touchpoints contributing to growth.”
- Digital sales grew the most, and performance from the company’s flagship e-commerce site and its partner sites led to a 21% Q3 growth in that channel year over year. For the first nine months of the year, it represented a 23% increase as compared to the same period last year.
Dive Insight:
With increased marketing efforts targeting a Gen Z customer and a move away from its roots in formalwear, Hugo Boss has managed to succeed where some other luxury companies are stumbling.
Although its growth has slowed since the company reported a 17% Q2 increase earlier in the year, it joins other luxury firms such as Zegna and Prada in being able to report positive Q3 numbers despite a consumer shift away from high-end spending.
“At HUGO BOSS, we look back on a successful third quarter, marked by double-digit top-and-bottom-line improvement,” Daniel Grieder, CEO of Hugo Boss, said in the release. “In an increasingly challenging market environment, we once again claimed our position and gained further market shares globally, driven by our several brand, product, and distribution initiatives. Building on our strong brand momentum, we are well on track to achieve our financial targets and make 2023 another record year for HUGO BOSS."
In its earnings release, the company credited “the improved perception of BOSS and HUGO as 24/7 lifestyle brands” for its particularly robust growth in the U.S. for the quarter. Boss womenswear also saw improvement with a 19% Q3 uptick, while the company’s Hugo brand improved 20%. Boss menswear, still the company’s strongest category, grew 7%.
Pippa Stephens, senior apparel analyst at GlobalData, said in an email to Fashion Dive that the growth in womenswear was attributable “to some extent” to the fact that the division was less established, and had more room for growth. “HUGO’s initiatives to boost appeal among younger shoppers are beginning to pay off, with its launch of a capsule collection in collaboration with influencer Bella Poarch at London Fashion Week in September 2023 resonating with Gen Z consumers,” she added.
For the remainder of its fiscal year, Hugo Boss stated that because of its strong performance for the quarter, the company was standing by its outlook for fiscal year 2023, which had previously “been revised upwards twice during the year.” While the company stated that “ongoing high levels of geopolitical tensions as well as macroeconomic uncertainties” could impact consumer sentiment, the company stated that it “continues to expect sales in 2023 to increase by between 12% and 15% to a new record level of between EUR 4.1 billion and EUR 4.2 billion.”
