The Italian luxury group Prada, despite the Middle East conflict, reported on April 30th a Q1 revenue that met expectations. However, the Iranian crisis negatively impacted sales of the popular Prada clothing and accessories brand Miu Miu, according to Bloomberg.
What did the company report?
— Prada's revenue in the first quarter rose by 6.5% year-on-year to €1.43 billion ($1.67 billion). This figure matched the consensus forecast of analysts surveyed by Bloomberg. Excluding currency fluctuations, the growth was 14% year-on-year.
— Prada's retail sales in the first quarter increased by 10% year-on-year excluding currency fluctuations, totaling €1.2 billion ($1.4 billion). However, excluding Versace's figures, which Prada completed acquiring in December, sales growth was only 1%. Meanwhile, sales of the previously most profitable brand of the Milan fashion house — Miu Miu — in the first three months of 2026 grew by 2% year-on-year, while in the first quarter of last year, this figure was around 60%.
— Versace's revenue totaled €143 million ($168 million) — in line with expectations, notes Bloomberg.
— Sales of the fashion house in the Middle East fell by 30% in the first quarter compared to the same period last year and by 22% excluding currency fluctuations, the company noted. The war in the region with a high concentration of wealthy buyers has weakened global demand for luxury goods, notes Bloomberg.
In Europe, the company's sales in the first quarter fell by 6% year-on-year due to weaker tourist spending and a moderate decline in local demand. However, management noted "encouraging signs of recovery in tourist spending" recently, writes Reuters.
Prada's retail sales in America grew by 15% year-on-year on an organic basis due to strong local demand, while in the Asia-Pacific region, it was up 5%, mainly driven by China and South Korea.
«We are operating in a highly complex environment characterized by ongoing uncertainty and a rapidly changing geopolitical situation,» said Prada Chairman and CEO Patrizio Bertelli (his words are quoted in the company's statement).
What's up with the stocks
Prada's depositary receipts trading on the over-the-counter market gained less than 1% on April 30. The company's stock in Frankfurt rose by 9%. In Hong Kong, it declined by 2.3%, however, the exchange closed before the quarterly results were published. Since the beginning of the year, Prada shares in Hong Kong are down nearly 23%.
Most analysts — 13 out of 21 tracking Prada stocks in Hong Kong — recommend buying shares of the luxury brand, according to MarketScreener data. Seven experts are cautiously advising to hold the company's stocks, and only one recommends shorting.
Context
Prada is not the only luxury sector company facing sales pressure due to the war in the Middle East. LVMH, Kering, and Hermès have also disappointed investors amid weak sales in the Middle Eastern region due to the ongoing conflict for the third month.
Prada acquired Versace for $1.4 billion in April 2025, at a time when growth rates for Miu Miu started to slow down, even though this brand is especially popular among the younger audience. Versace finished the previous year with a loss and is expected to remain in the red this year amid the brand's relaunch, notes Bloomberg. The group is counting on Peter Mulier, who will take over as creative director of Versace on July 1, 2025, to breathe new life into the brand after a tough period of declining revenue and losses, reports The Wall Street Journal.
The acquisition of the historical Italian brand Prada is seen as a move to expand the portfolio and client base against the dominance of luxury conglomerates like LVMH and Kering, the newspaper points out.
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