Hugo Boss had tough Q3, but Americas sales are strongest

Hugo Boss’s Q3 numbers that were released on Tuesday contained a lot of negatives but the company remained upbeat overall. It saw a 1% constant currency sales dip in Q3, the German fashion giant said, as it cited “persistently challenging market conditions”.

“Macroeconomic headwinds and subdued consumer sentiment weighed on global industry development, particularly impacting the performance in key markets such as the UK and China,” it explained.

But it also said it continued its execution of “strategic initiatives” that are strengthening brand relevance, including the successful launch of AW25 collections and its Boss SS26 Fashion Show.

So what happened in Q3? Total group sales on a reported basis fell 4% to €989 million. By brand, Boss Menswear was flat on a currency-adjusted basis and down 3% reported at €764 million. Boss Womenswear fell 9% currency-adjusted and 10% reported to €67 million. And Hugo was down 5% currency-adjusted and 7% reported at €158 million. 

The company saw a 3% currency-adjusted sales improvement in the Americas that “largely compensate[d] for moderate revenue declines” in EMEA (down 2%) and Asia/Pacific (down 4%). But while those currency-adjusted figures don’t look too bad, on a reported basis the Americas fell 3% to €223 million while EMEA was down 3% at €641 million and Asia pacific was down 9% at €101 million. Licenses fell 14% on both a currency-adjusted and reported basis to €25 million.

Clearly exchange rate fluctuations had a big negative impact during the quarter.

But it saw “sustained growth in digital” (+2% currency-adjusted and +1% reported at €201 million) and “sequential improvements” in physical stores where sales were flat currency-adjusted and down 3% reported at €483 million. The decline in physical wholesale of 5% currency-adjusted and 7% reported to €281 million reflected the timing of deliveries.

But the gross margin improved by 100 basis points in Q3, mainly due to efficiency gains in sourcing and lower freight-cost levels. And operating expenses declined by 3%, “reflecting ongoing strict cost discipline and additional efficiency gains”.

Profits outlook

Profits-wise, EBIT was “largely stable” although that doesn’t mean there was no movement as it was down 1% compared to a 1% rise for the year to date.

As for the outlook, the company confirmed its top- and bottom-line guidance for 2025. In line with market expectations, group sales and EBIT are expected to “align with the lower end of guidance ranges”. Those ranges include sales of between €4.2 billion and €4.4 billion, with EBIT ranging from €380 million-€440 million, “due to heightened macroeconomic volatility and significant currency headwinds”.

It added that brand and product initiatives such as the latest Beckham x Boss collection launch combined with ongoing efficiency measures in sourcing, sales, and administration are “expected to support Q4 top- and bottom-line performance”.

CEO Daniel Grieder said: “Despite ongoing global market volatility in Q3, we remained focused on our strategic priorities, emphasising long-term brand strength over short-term gains. In this context, we are particularly encouraged by the sequential improvement in our direct-to-consumer business, as both digital sales and retail improved slightly. At the same time, we achieved meaningful efficiency gains, delivering notable gross margin expansion and streamlined expenses. This is clear evidence of the operational excellence and resilience at the core of our business model.”