MILAN — Ferragamo’s direct-to-consumer business and the Americas contributed to offset the contraction in the Florence-based company’s wholesale channel and a lackluster performance in China last year.

In 2025, Ferragamo operated at a loss, but margins progressively improved in the second half of the year as management focuses on the brand’s core and leather goods categories, on the optimization of its retail network, and investing in its digital platforms and marketing and communication.

During a call with analysts at the end of trading on Wednesday, executive board member Ernesto Greco said the company last year “refined its strategic priorities” with “the objective of reinforcing coherence across the entire value chain.”

In the leather goods segment, the signature Hug collection has been broadened and the Soft bag has become a bestseller, as Ferragamo also intensified its focus on silk products and other accessories such as charms, bijoux or belts, “leveraging in-store cross-selling opportunities,” said Greco, underscoring the brand’s objective to “be the reference destination for shoes.”

“Operating within a volatile geopolitical and macroeconomic environment and acknowledging the ongoing selective approach to the wholesale channel, our strategy for 2026 is focused on building on the initial success of our action plan, confirmed by the solid performance of our DTC segment,” Greco said.

Responding to a question about the ongoing search for a chief executive officer, following the exit of Marco Gobbetti in March 2025, Greco confirmed “it is in place,” but he underscored that his “first priority” is that the current management “move as fast as a CEO could do and that people already in the company are doing their job with the necessary speed. I leave to your judgment the answer.”

Revenues in 2025 fell 5.7 percent to 976.5 million euros compared with 1.03 billion euros in 2024. At constant currency sales were down 3.8 percent.

Earnings before interest, taxes, depreciation and amortization decreased 22.7 percent to 166 million euros compared with 215 million euros, with an incidence on revenues of 17 percent.

Adjusted operating profit before write-downs of assets and impairment tests, excluding 46 million euros negative cost, amounted to 24 million euros compared with 35 million euros in 2024.

Net loss, including a minority interest and excluding the impairment tests charge for both 2024 and 2025, amounted to 3 million euros compared with a net profit of 16 million euros in 2024. However, in the second half last year the company reported an adjusted net profit of 13 million euros compared with a loss of 16 million euros in the first half.

Current Trading

Asked about current trading, Greco said the U.S. “continued to show a very strong performance as they did in the last quarter last year, with a solid double-digit growth, even though the comparison base was quite challenging.” Latin America is also “quite interesting” for Ferragamo, and a high-single-digit growth. Pointing to a strong focus on the Americas, Greco said the company is “allocating special activities” to those markets.

Europe is being “flattish” although against challenging comps, and Asia-Pacific is showing double-digit growth in the DTC channel against a “not so strong 2025. [South] Korea is performing very well with a solid double-digit growth, but China is still in the negative range.”

Japan is dented by the lack of Chinese customers and the currency exchange, while showing a solid single-digit growth in the DTC channel at constant currency, Greco said.

Distribution by Channel

In 2025, the DTC channel reached sales of 752.3 million euros, down 3.1 percent and representing 75 percent of total sales. At constant currency the channel inched up 0.4 percent. Greco said “our objective remains improved store efficiency through a selective reassessment of our network and prioritizing key stores with higher productivity,” and that around 70 stores that are not performing well will be closed between last year and 2026. Many of these closures will be in China, said Greco, with the goal to open new ones “in more attractive cities.”

He added that Ferragamo has seen “some new customers in China, and a new very interesting target between 30 and 38 years old.”

He also said Ferragamo has enhanced its e-commerce platform “to deliver a superior online experience and have witnessed a solid growth trajectory.”

The wholesale channel decreased 17.5 percent to 192 million euros. “We want to be present in markets where we have monobrand stores, or franchised, or in very nice multibrands. We don’t want to compromise at all.”

Without naming Saks Global and its bankruptcy, Greco said Ferragamo stopped shipments “ to a very important wholesaler in the U.S.” in the first period of the year, but that it has now resumed them.

Business by Geographies

Asked whether the war in the Middle East is affecting Ferragamo, Greco said the company does not have directly operated stores in the region and that the wholesale business there “is negligible, accounting for less than 2 percent last year.”

He added that, if the war does extend in time, the effect for the luxury business would be “indirect, with inflation up, less propensity to spend, and less travels.”

In 2025, sales in Europe totaled 235.6 million euros, down 4.4 percent and accounting for 25 percent of total revenues.

North America was down 0.9 percent to 305 million euros, representing 32.3 percent of the total. At constant currency sales in the region rose 3.1 percent.

Sales in Japan totaled 78 million euros, down 6 percent.

Sales in Asia-Pacific amounted to 246 million euros, down 15.6 percent and accounting for 26 percent of the total.

Revenues in Central and South America were down 1.4 percent to 80 million euros, but at constant currency the area was up 7.9 percent.

Sales by Category

By category, sales of footwear amounted to 409.6 million euros, representing 43.4 percent of the total, down 11.1 percent.

Leather goods fell 3.2 percent to 400 million euros, accounting for 42.3 percent of the total.

Apparel was down 2.4 percent to 59 million euros, representing 6.3 percent of the total.

Silk and other products rose 1.4 percent to 76 million euros, representing 8 percent of the total.

Greco underscored the company will continue to control and optimize its costs and reduce the number of its “idle” stock keeping units, as “there are too many products, some with a very modest sales turnover, and they confuse our customers. This will lower our inventory.”

As of Dec. 31, capital expenditures amounted to 46 million euros compared with 71 million euros in 2024, mainly channeled into the renovation of the retail network.

The adjusted net financial position stood at 144 million euros compared with 173 million euros at the end of December 2024. Including the IFRS16 effect, the net financial position was negative, with a debt of 439 million euros at the end of December last year.