Hugo Boss Projects Disappointing 2024 Despite Record-Breaking 2023; Shares Take Nosedive

By Trisha Andrada

Mar 07, 2024 10:05 AM EST

Hugo Boss, a German luxury fashion brand, warned that it may not reach its 2025 sales goal due to deteriorating customer demand. This sent its shares plunging 18% before discreetly recovering losses on Thursday, Mar. 7.

With the announcement that it anticipates slower sales growth in the coming year, the high-end clothing label set its sights on its worst trading day since 2016. This is despite sales reaching 4.2 billion euros ($4.6 billion) in 2023, a rise of 18% from the previous year. 

Hugo Boss goods are seen in the show room at the Hugo Boss headquarter on March 26, 2008 in Metzingen, Germany.
(Photo : Alexander Hassenstein / Getty Images)

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Declining Buyer Demand

In an interview with CNBC, CEO Daniel Grieder said that 2023 was a record year, but 2024 will see more moderate growth of 3% to 6%. He said the company's goal of 5 billion euros ($5.4 billion) in revenue, initially set for 2025, would be pushed back a little.

Grieder said, "Even if consumer sentiment is getting, here and there, a bit tough, we actually are on course, and we believe that going forward - also with the macroeconomic environment and geopolitical issues - we are well on track."

Macroeconomic and geopolitical factors have hit consumer spending hard, leading to the revised prediction. Other luxury firms, including Burberry and LVMH, have also reported declining sales.

According to Grieder, Hugo Boss is in a strong position as an affordable luxury or upper premium brand that can provide price flexibility without lowering profit margins.

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