German menswear specialist Hugo Boss had the worst quarter it’s seen in around two years, with sales sinking 6 percent to 905 million euros, in currency adjusted terms.

“Following our successful finish to 2025, we entered the year with a clear roadmap,” Hugo Boss chief executive officer Daniel Grieder said in a statement. “However, the market environment has become more challenging over the course of the first quarter, caused by recent developments in the Middle East.”

This meant Hugo Boss had to focus on the back-to-basics, profit-optimization strategy it had laid out at the end of last year, Grieder said, as it became clear more ambitious targets were not going to be met.

The plan, named “Claim 5 Touchdown,” would entail significant financial pain, the company’s executives previously said, adding that Hugo Boss likely wouldn’t return to real growth until 2027 at the earliest.

That was why the sales decrease this quarter was expected, Grieder explained.

Despite the sales drop, results were still slightly better than market analysts had expected.

The first quarter decrease was driven by Hugo Boss sales in its home market of Europe, the Middle East and Africa. There, sales fell by 8 percent, in currency adjusted terms, in the German company’s biggest market.

Key markets — Germany, France and the UK — all saw similar decreases, the company noted. “This development reflects ongoing muted consumer sentiment, as well as initial progress in implementing targeted enhancements to distribution quality,” Hugo Boss said in its statement.

In the Americas, sales sank 5 percent in currency adjusted terms to 188 million euros.

The Asia-Pacific region was the only one where Hugo Boss saw growth, with sales there rising 1 percent in currency adjusted terms, to bring in 123 million euros. This was thanks to a return to growth in China and growing demand in Japan.

Sales of the company’s more casual brand, Hugo, plummeted 21 percent, currency adjusted, but the more formal offerings under the Boss label only dropped 3 percent. The latter makes up most of Hugo Boss’ business.  

Hugo Boss is currently streamlining and repositioning the Hugo category, the company stated.

The German company’s operating result — EBIT, or earnings before interest and taxes — also nosedived by 42 percent in the first quarter. Over the same period last year, it had totaled 61 million euros, this year it came in at 35 million euros.

The company confirmed its guidance for the full year and predicts more pain to come: Sales revenues will fall in the mid- to high-single digits throughout the year and operating profit will decrease to between 300 million and 350 million euros.

“The outlook remains subject to continued macroeconomic and geopolitical uncertainty, as well as the further development of global consumer sentiment,” Hugo Boss warned in its statement.