Kering's Bold Move: Demna Takes the Helm at Gucci

Kering's shares dropped after appointing Demna as Gucci's design chief. Known for streetstyle at Balenciaga, analysts view his selection as risky, potentially impacting Gucci's timeless reputation. As Gucci aims to redefine its artistic direction amid declining sales, Demna's previous controversies also raise questions about the brand's future.

Kering's shares witnessed a dramatic fall on Friday morning, sinking by 12% during early Paris session trade following the company's decision to appoint Demna, Balenciaga's former designer, as Gucci's new design chief.

The fashion community had eagerly awaited news about the successor to Sabato de Sarno, who was dismissed earlier in the year. While Demna, known for his streetstyle-inspired looks, was acclaimed at Balenciaga, his transition to Gucci—a brand synonymous with timeless elegance—has stirred concerns among industry analysts.

Gucci's prolonged sales decline, highlighted by a 24% fourth-quarter revenue drop, poses a significant challenge for Demna. The forthcoming Milan fashion show in September may or may not showcase his influence, leaving the fashion world to anticipate whether this controversial decision will revert Gucci to a trend-setting powerhouse.

(With inputs from agencies.)