Model Update Ahead of 1H26 EPS

Research evidence excerpt

Model Update Ahead of 1H26 EPS

TD Cowen Kering SA

Global Research June 24, 2026

AT A GLANCE

Our Investment Thesis Forthcoming Catalysts

We rate KER Hold while the Gucci brand (~39% of KER sales) remains in a transition period ■ 1H earnings in June

with the new Creative Director. The company is also balancing introducing new handbag and ■ Luxury peer results

accessories icons for Gucci, which may take 12-18 months to layer into the carryover inventory.

Meanwhile, we expect the interim to be an investment period for the company on real estate,

marketing, building the beauty business, and product execution. We like KER's agility on brand

and product innovation, which consistently instills the company's fashion heritage among each

luxury house.

Base Case Assumptions Upside Scenario Downside Scenario

■ FY26 growth of +MSD%, primarily driven ■ International tourism rebounds greater ■ Luxury spending decelerates significantly

by volatile trends in China and the U.S., than expected, particularly among across geographies

store closures, and wholesale reduction Chinese tourists ■ Higher input costs and investments

■ EBIT margin pressure and operating ■ Operating margin at Gucci recovers faster pressure margins more than anticipated

income declines on sales deleverage and than expected with strong reception to ■ Unfavorable currency fluctuations

investments in marketing and product new product ■ New Gucci product not resonating with

development ■ Global luxury spending increases customers

■ Assume F/X remains at current levels

Price Performance Company Description

Kering is a company with a portfolio of luxury brands including Gucci, Yves Saint Laurent,

€400

Bottega Veneta, Balenciaga, and Alexander McQueen, among other houses. The group has