Valentino: when will it become a profitable fashion barand? Qatari fund Mayhoola has changed CEO (Riccardo Bellini is now in place) and appointed Alessandro Michele as creative director, but so far there have been no major signs of improvement. The “good” move was the agreement with Kering, although there’s a sense that it could be renegotiated in light of the maison’s latest performance. In other words: today, a fascinating brand doesn’t correspond to equally attractive numbers, and the doubts about its future are many.
Doubts about Valentino’s future
From 2017 to 2024, Valentino’s revenue increased by only €150 million, equivalent to +13% over eight years, little compared to the luxury sector average. Moneta points out that the most worrying aspect is profitability, which at best is “rather thin”. In 2023, EBIT stood at 7% of revenues, compared to a sector average of at least 20%. These figures were, moreover, more favorable than those of subsequent years.
Even 2025, for which financial statements aren’t yet available, was a difficult year. Regarding the operating company, Cerved forecasts a revenue of €836 million and a loss of €46 million, compared to a FY 2024 that closed with €870 million in sales and €78 million in losses. These numbers must be considered in light of the company’s debt, which has exceeded €1 billion. The current situation isn’t so different from the brand’s history: since 1998, when it was sold to Hdp of Maurizio Romiti, the maison has gone through many changes of ownership.
Overvalued
According to Moneta, Kering paid too much for Valentino, as the valuation underpinning the agreement with Mayhoola was excessively high: over €5.2 billion. “That means valuing it at almost five times its revenues and at an incalculable multiple of operating margins”.
Kering has taken time to reflect on what to do next, as it could acquire 100% of the fashion house within the next three years. But would Valentino become yet another problem for Kering to solve? Today, the answer would be yes. In three years’ time, it’s impossible to say, but by then, at least, we will know whether the Mayhoola turnaround and the Michele effect have truly changed the course of the Roman fashion house.
Read also:
- While Arnault hints at M&A, shareholders inject funds into Valentino
- Tough times for Mayhoola: Valentino, Albini, acquisitions on hold
