ZGN Q3 2025 Earnings Call Summary

1Key Financial Results and Metrics

Q3 Revenues: EUR 398 million, up 4% organically.

9-Month Revenues: EUR 1.3 billion.

DTC Channel Growth: 9% in Q3, accounting for 82% of total revenues.

Brand Performance:

ZEGNA: EUR 249 million, +6% growth.

TOM FORD FASHION: EUR 66 million, +4% growth.

Thom Browne: EUR 48 million, slight decline but sequential improvement.

Textiles: Flat performance.

Other Revenues: +12% growth.

Geographic Performance:

EMEA: +3% growth.

Americas: +13% growth, with strong DTC performance.

Greater China: -7% decline, though showing signs of improvement.

2Strategic Updates and Business Highlights

Continued focus on organic performance, excluding foreign exchange impacts.

Successful DTC channel growth attributed to strong brand performance and product acceptance.

ZEGNA closed 4 stores in Greater China, reflecting a strategic shift towards retail concessions.

Thom Browne opened new stores, including a significant concession in Selfridges, London.

TOM FORD FASHION received positive feedback for the Fall/Winter '25 collection, indicating early signs of brand strengthening.

3Forward Guidance and Outlook

Q4 Expectations: Trends are expected to remain consistent with Q3; however, comparisons will be challenging due to strong Q4 last year.

ZEGNA Wholesale Guidance: Expected to decline in the mid-teens for the year.

Margin Guidance: ZEGNA segment margins anticipated between 13% and 14% for the full year.

Currency Impact: Anticipated between 4% and 5% for Q4, with ongoing focus on managing foreign exchange risks.

4Bad News, Challenges, or Points of Concern

Greater China Volatility: Continued uncertainty in consumer demand, particularly in high-tier markets, with a noted decline in Chinese consumers shopping abroad.

Wholesale Channel Decline: Significant drops in wholesale performance for Thom Browne (-37% in Q3) and TOM FORD (-19%).

Currency Fluctuations: Ongoing headwinds from currency exchange rates affecting margins.

Retail Environment: Challenges in traffic and conversion rates in certain regions, particularly in Japan and Macau.

5Notable Q&A Insights

Current Trading: Q4 trends are not expected to differ significantly from Q3, but the company remains cautious due to previous strong performance.

Consumer Environment: U.S. and European markets are performing well, while Greater China remains volatile.

Wholesale Rationalization: Efforts to streamline wholesale distribution will continue, but at a reduced intensity compared to previous years.

TOM FORD FASHION: Positive initial reception of Haider Ackermann's collection, with expectations for continued growth driven by CRM initiatives and store openings.

APAC Performance: Mixed results, with Singapore performing well while Japan and Macau show weakness. This summary encapsulates the key takeaways from ZGN's Q3 2025 earnings call, providing a balanced view of financial performance, strategic initiatives, and challenges ahead.