Prada Posts Modest Q1 Growth as Miu Miu Cools

MILAN – Prada Group first-quarter revenue advanced 3 percent, with a prolonged luxury slowdown and the Middle East War tempering growth at Miu Miu.

Revenue came to €1.43 billion ($1.67 billion), rising on an organic basis, which strips out currency fluctuations and the contribution of recently acquired Versace. The figure marks 21 quarters of non-stop growth for the Milanese fashion group which has outpaced peers – Prada’s last quarterly revenue decline was in 2020 - as was largely in line with analysts’ estimates,

Prada’s results come against the backdrop of a luxury slowdown now in its third year. Already grappling with uneven regional demand and the backlash that followed recent steep price hikes, the industry has been further hit by conflict in the Middle East - a rare bright patch of luxury spending before war broke out. Hostilities are leading to a surge in oil prices and a broad rise in inflation that risks weighing on luxury demand globally.

“The Middle East is an issue,” chief executive Andrea Guerra said on a conference call with analysts, adding that the war had shaved about 1.5 percentage points off of the group’s revenue figure in the quarter.

Earlier this month, LVMH reported a first-quarter drop in revenue at its fashion and leather goods division while Kering had another tough quarter with ongoing declines at Gucci. Growth even slowed at Hermès, one of the sector’s most resilient performers. This week, Armani said revenue dropped 2.8 percent in 2025.

“We are navigating a highly complex environment, marked by persistent uncertainty and rapidly evolving geopolitical dynamics,” Prada chairman Patrizio Bertelli said in a statement.

Prada brand retail sales inched 0.4 percent higher on the quarter, matching the modest gain from the final quarter of 2025. While muted, the growth over the past two quarters shows improvement after revenue declines in the first three quarters of last year. The figure came in slightly below analysts’ expectations.

Guerra and his team are aiming to engineer a soft landing at Miu Miu, an industry outlier where sales have surged over the past few years and lifted the group. In the first quarter, Miu Miu’s retail sales advanced 2.4 percent.

While revenue at the label has grown every quarter for more than four years, the rate has begun to ease and Miu Miu has been hit harder than Prada by disruption in the Middle East, where it gets a higher percentage of sales than its larger stablemate. Guerra said the war had cost Miu Miu 2.5 percentage points of revenue growth in the first quarter, meaning growth would have been close to 5 percent without the war.

Miu Miu was up against difficult comps, having grown 60 percent in last year’s first quarter. After the multi-year surge, the brand is now expected to book annual revenue of €1.7 billion to €1.8 billion.

“The bar is now high [for Miu Miu],” Guerra said.

Versace, acquired by Prada at the end of last year, posted net revenue of €143 million in the first quarter. Prada didn’t provide a year-ago figure for the struggling Italian brand and said the result was in line with the group’s expectations. Prada is trying to reposition Versace at a higher price point, in part by paring back its strong presence at outlet malls.

This year will be “challenging” for Versace, but it is part of a process to get the brand ready for a “great journey” in 2027, Guerra told the analysts.

On the quarter, retail sales for the group rose 5 percent in Asia Pacific and 15 percent in the Americas, but dropped 6 percent in Europe and 22 percent in the Middle East.

Prada didn’t release profit figures for the first quarter.

The company’s shares, which are traded on the Hong Kong stock exchange, have lost almost half their value since early 2025 and have shed much of the gains made in the years immediately following the Covid pandemic.