Q2 2026 Ermenegildo Zegna NV Earnings Call

September 3, 2026

Operator: Good afternoon, good morning, everyone. Thank you for joining the Ermenegildo Zegna Group H1 2026 financial results call. Please note that today's material and presentation are available under the zegnagroup.com website. Before we begin, we need to point out that the team will make certain forward-looking statements during the call. The group actual results may be materially different from those expressed or implied by these forward-looking statements. Also, these statements are subject to a number of risks and uncertainties, including those described in our SEC filings. Please refer to the forward-looking statements, cautionary statements included in page 2 of today's presentation. I will now hand over to Paola Durante, Chief of External Relations and Sustainability.

Speaker #1: Before we begin, we need to point out that the team will make certain forward-looking statements during the call. The group's actual results may be materially different from those expressed or implied by these forward-looking statements.

Speaker #1: Also, this statement is subject to a number of risks and uncertainties, including those described in our SEC filings. Please refer to the forward-looking statements’ cautionary statement, included on page 2 of today's presentation.

Speaker #1: I'll now hand over to Paola Durante, Chief of External Relations and Sustainability.

Speaker #2: Thank you. Thank you, operator, and good morning, good afternoon, everyone. Thank you for being here today for our conference call on first half 2026 results.

Paola Durante: Thank you. Thank you, operator, and good morning, good afternoon, everyone. Thank you for being here today with our conference call on H1 2026 results. I will briefly comment on our financial results, which highlights you can find on page 3 of the presentation. I will then leave the floor to Gianluca Tagliabue, our Group CEO, for some final remarks, of course, before opening to your questions. On page 3, we skip commenting on H1 revenues since they have been already fully analyzed during the July call. So let's move directly to page 4 of the presentation to deep dive on the main metrics of our reported profit and loss. Starting with gross profit. In the H1 of 2026, gross profit reached EUR 668 million, with a margin on revenues of 67.6%.

Speaker #2: I will briefly comment on our financial results, which highlights you can find on page 3 of the presentation, and then I will leave the floor to Gianluca Tagliabue, our Group CEO, for some final remarks.

Speaker #2: Of course, before opening to your questions, on page 3, we skip commenting on H1 revenues since they have already been fully analyzed during the July call.

Speaker #2: So let's move directly to page 4 of the presentation to deep dive on the main metrics of our reported profit and loss. Starting with gross profit, in the first half of 2026, gross profit reached €668 million, with a margin on revenues of 67.6%.

Speaker #2: Gross profit remained supported by a favorable channel mix, given that DTC revenues generated 86% of branded group revenues, up from 82% in the first half of last year. As you know, DTC gross margin is higher than the wholesale one.

Paola Durante: Gross profit remains supported by a favorable channel mix, given that DTC revenues generated 86% of Branded Group revenues, up from 82% in the H1 of last year. As you know, DTC gross margin is higher than the wholesale one. This positive effect was partially offset by adverse ForEx movement. As a reminder, ForEx movement in the first six months of this year reduced top-line growth by 3 percentage points. Selling, general and administrative. SG&A expenses amounted in the H1 of 2026 to EUR 531 million, with an incidence on revenues that has slightly decreased to 53.8%. This has been primarily driven by improved operating leverage and lower impairment cost, and it happened despite ongoing investments in the expansion of the DTC distribution network. Finally, on marketing.

Speaker #2: This positive effect was partially offset by adverse foreign exchange movement. As a reminder, forex movement in the first six months of this year reduced top-line growth by 3 percentage points.

Speaker #2: Selling, general and administrative, or SG&A, expenses amounted in the first half of 2026 to €531 million, with an incidence on revenues that has slightly decreased to 53.8%.

Speaker #2: This has been primarily driven by improved operating leverage and lower impairment costs. And it happened despite ongoing investments in the expansion of the DTC distribution network.

Speaker #2: Finally, on marketing: marketing expenses reached €68 million, remaining broadly stable at 6.9% of revenues, reflecting our brand's disciplined approach in supporting the equity through focused and selective investments.

Paola Durante: Marketing expenses reached EUR 68 million, remaining broadly stable at 6.9% of revenues, reflecting our brand's disciplined approach in supporting the equity through focused and selective investments. Let's then move to page 5, where we report adjusted EBIT for the group and by segment. As you know, adjusted EBIT is the main metric used by management to analyze business performance at groups and segment level. In the first six months of 2026, adjusted EBIT landed slightly above EUR 74 million compared to EUR 69 million in the first six months of last year, with a margin of 7.5%. Looking at the results by segment. The Zegna segment, which includes Zegna brand, the textile division, and the third-party brands, generated an adjusted EBIT of EUR 107 million, which corresponded to a margin of 14.8% compared to 14.3% in the first six months of last year.

Speaker #2: Let's then move to page 5, where we report adjusted EBIT for the group, and by segment. As you know, adjusted EBIT is the main metric used by management to analyze business performance at group and segment level.

Speaker #2: In the first six months of 2026, adjusted EBIT landed slightly above €74 million, compared to €69 million in the first six months of last year, with a margin of 7.5%.

Speaker #2: Looking at the results by segment, the Zegna segment—which includes the Zegna Brand, the textile division, and the third-party brands—generated an adjusted EBIT of €107 million, which corresponded to a margin of 14.8%, compared to 14.3% in the first six months of last year.

Speaker #2: The 50 basis points increase in margin has been largely driven by operating leverage in the DTC channel, benefiting from higher revenues per square meter and improved DTC KPIs, including the sell-through.

Paola Durante: The 50 bps increase in margin has been largely driven by operating leverage in the DTC channel, benefiting from higher revenues per square meter and improved DTC KPIs, including the sell-through. Adjusted EBIT for Thom Browne segment was -EUR 8 million, compared to EUR 4 million positive in the first six months of last year. The decline reflects the adverse impact of ForEx movements, which for Thom Browne has been more severe than the group's average. Inventories embed that reserve evolution in line with the business trend and the cost related to talent acquisition and other investments to support the brand's transition towards a retail first culture. Moving now to TOM FORD FASHION segment. The TOM FORD FASHION recorded a EUR 12 million of adjusted EBIT loss, compared to a negative 19 in the first six months of last year.

Speaker #2: Adjusted EBIT for the Tom Brown segment was negative €8 million, compared to positive €4 million in the first six months of last year.

Speaker #2: The decline reflects the adverse impact of foreign exchange movements, which for Tom Brown has been more severe than the Group's average. Inventories and bad debt reserve evolution are in line with the business trend, as are the costs related to talent acquisition and other investments to support the brand's transition towards a retail-first culture.

Speaker #2: Moving now to the Tom Ford Fashion segment. The segment recorded a $12 million euro adjusted EBIT loss, compared to a negative $19 million in the first six months of last year.

Paola Durante: This improvement is primarily attributable to revenue growth, which allowed for greater absorption of fixed cost together with an ongoing cost discipline. Let's move to page 6. Here you find summarized our reported income statement for the H1 of this year and last year. I will comment here on profit specifically. In the first six months of 2026, profit reached EUR 28 million compared to EUR 48 million last year, which as you remember, included the positive effect from the remeasurement of the Thom Browne put option liability, that remeasurement that did not occur this year. More specifically, the sum of financial income and expenses, ForEx gains and losses in the H1 of 2026 move to a -EUR 23 million from a +EUR 6 million in the H1 of last year. This difference mostly reflects the just mentioned remeasurement of the Thom Browne non-controlling interest put option liabilities.

Speaker #2: This improvement is primarily attributable to revenue growth, which allowed for greater absorption of fixed costs, together with ongoing cost discipline. Let's move to page 6.

Speaker #2: Here you find summarized our reported incasso statement for the first half of this year and last year. I will comment here on profit specifically.

Speaker #2: In the first six months of 2026, profit reached €28 million compared to €48 million last year, which, as you remember, included the positive effect from the remeasurement of the Thom Browne put option liability.

Speaker #2: Debt remeasurement, debt did not occur this year. More specifically, the sum of financial income and expenses, foreign exchange gains, and losses in the first half of 2026 move from a positive $6 million—sorry, move to a negative $23 million from a positive $6 million in the first half of last year.

Speaker #2: This difference mostly reflects the just-mentioned remeasurement of the Thom Browne non-controlling interest put option liabilities. That is, I remind you, denominated in US dollars.

Paola Durante: That is, I remind you, denominated in US dollars. The value of the put option was reduced in the H1 of last year, also reflecting the sharp dollar depreciation. This generated non-monetary and non-taxable income for EUR 28 million in the H1 of 2025. As a reminder, in fiscal year 2025, the total positive impact from the Thom Browne put option was EUR 37 million. So only an additional EUR 9 million income was recognized in the H2 of 2025. Commenting now on income taxes. H1 of 2026 income taxes resulted in a higher effective tax rate equal to 39% versus 30% in the first six months of last year, mainly due to the already mentioned tax effect on non-taxable income. Tax rate for the group is normally higher in the first part of the year.

Speaker #2: The value of the put option was reduced in the first half of last year, also reflecting the sharp dollar depreciation. This generated non-monetary and non-taxable income of $28 million.

Speaker #2: In the first half of 2025. As a reminder, in fiscal year 2025, the total positive income impact from the Tom Brown put option was €37 million.

Speaker #2: So, only an additional $9 million income was recognized in the second part of '25. Commenting now on income taxes: in the first half of 2026, income taxes resulted in a higher effective tax rate, equal to 39%, versus 30% in the first six months of last year, mainly due to the already mentioned tax effect on non-taxable income.

Speaker #2: The tax rate for the group is normally higher in the first part of the year. Therefore, also this year and also in 2026, we expect the tax rate in the second half to be lower than what we recorded in the first six months.

Paola Durante: Therefore, also in this year, also in 2026, we expect tax rate in the H2 to be lower than what we recorded in the first six months. As already said in the past, commenting our results, a normal tax rate for the group is around 28% to 30%. Moving now quickly to page 7, CapEx and trade working capital. CapEx in the first six months reached EUR 64 million. The EUR 10 million increase compared to last year was mainly related to higher investments in production, including the new shoe production plant in Parma, which should start to operate by the end of the year. Very happy for that. Trade working capital stood at EUR 420 million at the end of June, compared to EUR 442 million at the end of June last year. The reduction has been mainly driven by lower receivables as a result of the streamlining of the wholesale business.

Speaker #2: As already said in the past, commenting on our results, a normal tax rate for the group is around 28–30%. Moving now quickly to page 7.

Speaker #2: Capex and trade working capital. Capex in the first six months reached $64 million. The €10 million increase compared to last year was mainly related to higher investments in production, including the new shoe production plant in Parma, which started to operate by the end of the year.

Speaker #2: Very happy for that. Trade working capital stood at €420 million at the end of June, compared to €442 million at the end of June last year.

Speaker #2: This reduction has been mainly driven by lower receivables, as a result of the streamlining of the wholesale business. Finally, on free cash flow and cash surplus—page 8 and page 9.

Paola Durante: Finally, on free cash flow and cash surplus, page 8 and page 9. On page 8, you can see that we generated EUR 19.9 million free cash flow this year compared to a EUR 23 million absorption in the first six months of last year. This, thanks to a stronger cash generation from operating activities, which of course was driven by higher EBIT and also by an improved trade working capital. Finally, on page 9, our net cash was EUR 60 million at the end of June, an increase higher than the EUR 52 million at the end of December 2025. With this, I finish my brief comments, and I leave the floor to Gianluca.

Speaker #2: On page 8, you can see that we generated €19.9 million of free cash flow this year, compared to a €23 million absorption in the first six months of last year.

Speaker #2: This is thanks to stronger cash generation from operating activities, which, of course, was driven by higher EBIT and also by improved trade working capital.

Speaker #2: And finally, on page 9, our net cash was €60 million at the end of June, higher than the €52 million at the end of December 2025.

Speaker #2: And with this, I finish my brief comment, and I leave the floor to Gianluca.

Speaker #1: Thank you, Paola. Before we open the floor to your questions, let me leave you with a few final thoughts, brand by brand. On H1, the results once again reflect the excellent work that the Zegna brand team is doing to strengthen the brand.

Gianluca Tagliabue: Thank you, Paola. Before we open the floor to your questions, let me leave you with a few final thoughts by brand. In H1, the results once again reflect the excellent work that the Zegna brand team is doing to strengthen the brand. The consistency and discipline behind the clear strategic vision continue to translate into solid top-line growth, while also supporting the margin expansion. This trend continues to be supported by the brand's ability to both increase its market share among the loyal customers, as well as attract new clients, all while remaining highly consistent in its positioning. Indeed, the very solid momentum has continued through July and August. As you may have noticed, we launched our fall-winter campaign today, fully dedicated to Su Misura, Make to Measure, which is also featured on the cover of this presentation and in several major publications.

Speaker #1: The consistency—and discipline—behind the clear strategic vision continues to translate into solid top-line growth, while also supporting margin expansion. This trend continues to be supported by the brand's ability to both increase its market share among loyal customers, as well as attract new clients.

Speaker #1: All while remaining highly consistent in its positioning. Indeed, the very solid momentum has continued through July and August. As you may have noticed, we launched our Fall-Winter campaign today, fully dedicated to Sumisura, make-to-measure, which is also featured on the cover of this presentation and in several major publications.

Speaker #1: The campaign is a tribute to our legacy and to the craftsmanship, expertise, and personalized approach that have distinguished the Zegna brand for generations. Because a Zegna Su Misura suit is not just a suit; it's a legacy that will be carried forward across generations.

Gianluca Tagliabue: The campaign is a tribute to our legacy and to the craftsmanship expertise and personalized approach that have distinguished Zegna brand for generations, because a Zegna Su Misura suit is not just a suit, it is a legacy that will be carried forward across generations. Regarding TOM FORD FASHION, this fall, we unveiled a powerful marketing campaign that, in my view, effectively conveys the brand's evolution and its increasingly sophisticated expression of elegance and seduction. Marketing is a strategic area where we are prepared to selectively deploy additional resources to further strengthen brand awareness and hype. In the past weeks, TOM FORD FASHION has continued to perform well, with healthy momentum as awareness and engagement continue to build. Now let me focus on Thom Browne. As you know, the brand's deep transformation is ongoing as it moves away from a wholesale-driven model into a retail-oriented go-to-market approach and culture.

Speaker #1: Regarding Tom Ford fashion, this fall we unveiled a powerful marketing campaign that, in my view, effectively conveys the brand's evolution and its increasingly sophisticated expression of elegance and seduction.

Speaker #1: Marketing is a strategic area where we are prepared to selectively deploy additional resources to further strengthen brand awareness and hype. In the past weeks, Tom Ford Fashion has continued to perform well, with healthy momentum as awareness and engagement continue to build.

Speaker #1: Now, let me focus on Thom Browne. As you know, the brand's deep transformation is ongoing as it moves away from wholesale-driven modeling to a retail-oriented go-to-market approach and culture.

Speaker #1: This transition is taking place in several phases. We are completing the reduction and upgrading of the wholesale network, and, to be honest, the process has been taking longer than initially anticipated, partially due to a challenging macroeconomic environment.

Gianluca Tagliabue: This transition is taking place in several phases. We are completing the reduction and upgrading of the wholesale network, and to be honest, the process has been taking longer than initially anticipated, partially due to a challenging macroeconomic environment. In 2025, we also began evolving the brand's leadership team. Sam Lobban, Thom Browne's new CEO, is building the organization with a stronger focus on DTC and a more customer-centric culture. As part of this effort, he has been reshaping the senior leadership team. We are confident that Sam, together with Tom, of course, are bringing the brand towards the right direction. Transformations of this nature require time and may temporarily weigh on results. The operating performance in H1 this year reflects both the decisions we have taken and the actions we continue to implement to strengthen the brand's long-term foundations.

Speaker #1: In 2025, we also began evolving the brand's leadership team. Sam Lobman, Tom's Brown's new CEO, is building the organization with a stronger focus on DTC and a more customer-centric culture.

Speaker #1: As part of this effort, he has been reshaping the senior leadership team. We are confident that Sam, together with Tom, of course, is bringing the brand in the right direction.

Speaker #1: Transformations of this nature require time and may temporarily weigh on results. The operating performance in H1 this year reflects both the decisions we have taken and the actions we continue to implement to strengthen the brand's long-term foundations.

Speaker #1: The success of the ASICS collaboration confirmed that the Thom Browne brand continues to resonate with consumers. However, while brand desirability is essential, it is not enough on its own.

Gianluca Tagliabue: The success of the ASICS collaboration confirmed that the Thom Browne brand continues to resonate with consumers. However, while brand desirability is essential, it is not enough on its own. We are working with Sam across all the key levers of the business, including collection merchandising, open-to-buy planning and assortment, marketing, go-to-market execution, in order to ensure that both existing and prospective customers are engaged, can find the right product offering, and continue to build a relationship with the brand over time. The more recent marketing campaign of Thom Browne, which went out in the last few days, I believe, offer evidence of the brand's intention to widen its customer base. Fashion operates on long lead times. Building a stronger brand and a more sustainable growth platform requires patience, disciplined execution, and consistency.

Speaker #1: We are working with Sam across all the key levers of the business, including collection merchandising, open-to-buy planning and assortment, marketing, and go-to-market execution, in order to ensure that both existing and prospective customers are engaged, can find the right product offering, and continue to build a relationship with the brand over time.

Speaker #1: The more recent marketing campaign of Tom Brown, which went out in the last few days, I believe, offers evidence of the brand's intention to widen its customer base.

Speaker #1: Fashion operates on long lead times. Building a stronger brand and a more sustainable growth platform requires patience, disciplined execution, and consistency. As we did a few years ago with the one-brand strategy of the Zegna brand, our focus for Tom Browne is exactly this: building a stronger brand with foundations able to deliver sustainable and profitable growth for the long term.

Gianluca Tagliabue: As we did a few years ago with the One Brand strategy of the Zegna brand, our focus for Thom Browne is exactly this, building a stronger brand with foundations able to deliver sustainable and profitable growth for the long term. Looking ahead, we expect Thom Browne H2 2026 EBIT to return positive in the semester, bringing full-year EBIT close to breakeven. In H2, ForEx will have less negative impact, our comparison base will become less demanding, and we have implemented actions to support gross profit and to control costs. Let me conclude now with a comment on our Parma factory, which is a strategic project that we launched a couple of years ago. We are now completing this important investment, which is much more than a manufacturing facility.

Speaker #1: Looking ahead, we expect Tom Brown H2 '26 EBIT to return positive in the semester, bringing full-year EBIT close to break-even. In H2, forex will have less negative impact.

Speaker #1: Our comparison base will become less demanding, and we have implemented actions to support gross profit and to control costs. Let me conclude now with a comment on our Parma factory, which is a strategic project that we launched a couple of years ago.

Speaker #1: We are now completing this important investment, which is much more than a manufacturing facility. It is a center of excellence, bringing together craftsmanship, innovation, and operational capabilities in a unique setting surrounded by a wonderful natural environment.

Gianluca Tagliabue: It is a center of excellence, bringing together craftsmanship, innovation, and operational capabilities in a unique setting, surrounded by a wonderful natural environment. As we have done since the group's foundation, we continue to invest in the filiera, our distinctive and unique Italian integrated supply chain to support the group developments for years to come. We look forward to welcoming you in Parma next year. With that, let's open the Q&A.

Speaker #1: As we have done since the group's foundation, we continue to invest in the filiera—our distinctive and unique Italian integrated supply chain—to support the group's developments for years to come.

Speaker #1: We look forward to welcoming you in Parma next year. And with that, let's open the Q&A.

Speaker #2: Thank you, Gianluca. We will now begin the question-and-answer session. If you would like to ask a question, please press star one to raise your hand.

Gianluca Tagliabue: Thank you, Gianluca. We will now begin the question and answer session. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. We ask that you mute your handset when asking a question to allow for optimum sound quality. If you are muted locally, please remember to unmute your device. Please stand by while we compile the Q&A roster. Your first question comes from the line of Robert Gronkowski with UBS. Your line is now open. Please go ahead.

Operator: Thank you, Gianluca. We will now begin the question and answer session. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. We ask that you mute your handset when asking a question to allow for optimum sound quality. If you are muted locally, please remember to unmute your device. Please stand by while we compile the Q&A roster. Your first question comes from the line of Robert Krankowski with UBS. Your line is now open. Please go ahead.

Speaker #2: To withdraw your question, press star one again. We ask that you pick up your handset when asking a question to allow for optimum sound quality.

Speaker #2: If you are muted locally, please remember to unmute your device. Please stand by while we compile the Q&A roster. Your first question comes from the line of Robert Krenkowski with UBS.

Speaker #2: Your line is now open. Please go ahead.

Robert Gronkowski: Hi. Thank you. I have only two questions. My first one is on the Zegna segment margins in H2. Comparatives are becoming somehow tougher in H2, but you mentioned that July and August were still very solid. Should we expect the pattern seen in 2024, 2025 when the EBIT margin was better in H2 than in H1 to continue? The second one, and I appreciated the call about the profitability rather than current trading. You mentioned already that the trends were very solid in July and August. Should we think that there was some level of improvement compared to your commentary from July when there was a bit more volatility?

Robert Krankowski: Hi. Thank you. I have only two questions. My first one is on the Zegna segment margins in H2. Comparatives are becoming somehow tougher in H2, but you mentioned that July and August were still very solid. Should we expect the pattern seen in 2024, 2025 when the EBIT margin was better in H2 than in H1 to continue? The second one, and I appreciated the call about the profitability rather than current trading. You mentioned already that the trends were very solid in July and August. Should we think that there was some level of improvement compared to your commentary from July when there was a bit more volatility? Anything to call out related to China because we hear a bit more mixed things, and I think the comparatives are getting a bit tougher. Thank you.

Speaker #3: Hi, thank you. I have only two questions. My first one is on the Zegna segment margins in the second half. Comparatives are becoming somewhat tougher in the second half of the year, but you mentioned that July and August were still very solid.

Speaker #3: So, should we expect the pattern seen in 2024 and 2025, when the EBIT margin was better in the second half than in the first half, to continue?

Speaker #3: And the second one—and I appreciate this is a call about profitability, rather than current trading—you mentioned already that the trends were very solid in July and August.

Speaker #3: So, should we think that there was some level of improvement compared to your commentary from July, when there was a bit more volatility? And is there anything to call out related to China?

Robert Gronkowski: Anything to call out related to China because we hear a bit more mixed things, and I think the comparatives are getting a bit tougher. Thank you.

Speaker #3: Because we hear a bit more mixed things, and I think the comparatives are getting a bit tougher. Thank you.

Speaker #4: Thank you, Robert. Okay, on the first and the second, I'll leave Gianluca to make some comments. So, the first one is on Zegna segment EBIT, H2 versus H1, or filiera.

Paola Durante: Thank you, Robert. Okay, on the first and the second, I will leave Gianluca to make some comments. The first one is on Zegna segment EBIT H2 versus H1 or full year.

Gianluca Tagliabue: Let us talk about the full year. In Zegna segment, we expect the adjusted EBIT margin in the region of 15%, driven by all the positive trends that we have mentioned. If I need to label it in one word, it is about high-quality growth. That is what we see for the year for the Zegna segment, around that mark.

Speaker #1: Let's talk about the full year. In the Zegna segment, we expect the adjusted EBIT margin to be in the region of 15%, driven by all the positive trends that we have mentioned. And if I need to label it in one word, it's about high-quality growth.

Speaker #1: So that's what we see for the year for the Zegna segment around that mark.

Speaker #4: And for the comment compared to July, of course, Robert, in July there were only a few weeks of the quarter. Now we have a little bit more weeks.

Paola Durante: And for the comment compared to July, of course, Robert, in July there was only few weeks of the quarter. Now we have a little bit more weeks, still important months to go, but I leave Gianluca if he wants to give a sense of if we are more confident or different from July. This is what Robert meant in his question.

Speaker #4: There's still an important month to go, but I'll let Gianluca respond if he wants to give a sense of whether we are more confident or different from July. This is what Robert meant in his question.

Speaker #1: So, as Paola said, of course, the quarter is still missing the important month of September. We just delivered important drops of product, both for Zegna and also recently for the winter of Tom Ford.

Gianluca Tagliabue: Paola is saying, of course, the quarter is missing still the important month of September. We just deliver important drops of products both for Zegna and also recently for the winter of TOM FORD FASHION. The comments cannot be complete. They are definitely partial. But let me give you some highlights by brand on the DTC, of course. Overall, we continue to see a substantial, solid, double-digit positive trend for Zegna DTC with good performance across all regions and across all nationalities. We continue to support with confidence the business. TOM FORD FASHION is seeing a good trend across markets, and Thom Browne has seen a visible deceleration in Q3, partially expected, having been Q1 and Q2 positively impacted by the new store openings and by the ASICS launch, which was across March and April, the big numbers.

Speaker #1: So the comments cannot be complete. They are definitely partial. But let me give you some highlights by brand on the TC, of course. Overall, we continue to see a substantial, solid double-digit positive trend for Zegna DTC, with good performance across all regions and across all nationalities.

Speaker #1: And we continue to support with confidence the business. Tom Ford is seeing a good trend across markets. And Thom Browne has seen a visible deceleration in Q3, partially expected, having been Q1 and Q2 positively impacted by the new store openings and by the ASICS launch, which was across March and April, the big numbers.

Speaker #1: As I said before, we are in a transition phase. On Tom, Sam—on Tom Brown—Sam and Tom are building the new team. We are carefully assessing the store network, and we are investing in all the retail functions, departments, and activities.

Gianluca Tagliabue: As I said before, we are in a transition phase on Thom Browne. Sam with Tom are building the new team. We are carefully assessing the store network, and we are investing on all the retail functions, departments, activities. As I said before, it is taking some time, but we are really confident that under Sam leadership, we are moving in the right direction. The third question was about GCR. We are reading as I think you are reading some question marks and volatility on the market. We see that volatility. We do not comment for the other brands, of course, but it is important to have, in China like everywhere, very consistent brand strategy. This is what we are doing with the Zegna brand. In China, I think we have found a unique position that we believe is allowing us to get market share. It is a journey.

Speaker #1: And this, as I said before, is taking some time, but we are really confident that under Sam's leadership, we are moving in the right direction.

Speaker #1: You asked—the third question was about GCR. We are reading, as I think you are reading, some question marks and volatility in the market.

Speaker #1: We see that volatility. We don't comment on the other brands, of course, but it's important to have in China, like everywhere, a very consistent brand strategy.

Speaker #1: And this is what we are doing with the Zegna brand. In China, I think we have found a unique position that we believe is allowing us to gain market share.

Speaker #1: It is a journey; things need to be done, but we are confident that we have undertaken the right steps in China, and we are seeing some good momentum in terms of market share gain.

Gianluca Tagliabue: Things needs to be done, but we are confident that we have undertaking the right steps in China, and we are seeing some good momentum in terms of market share gain on the Zegna brand, which is continuing to do well also in July and August. In any case, the softness that we are seeing reported in many press release reports and many news, the factor that it is probably impacting the most Thom Browne performance in the market over the summer. I would bifurcate the China in these two ways. Zegna performing well and an impact on the Thom Browne performance.

Speaker #1: On the Zegna brand, which is continuing to do well, also in July and August. In any case, the softness that we are seeing reported in many personalist reports and many news is, in effect, the factor that is probably impacting the most Tom Browne's performance in the market over the summer.

Speaker #1: So, I would buy for Kate the China in these two ways: Zegna performing well, and an impact on the Thom Browne performance.

Speaker #4: Thank you.

Paola Durante: Thank you.

Speaker #2: Your next question comes from the line of Adrian Duvegier with Goldman Sachs. Your line is now open. Please go ahead.

Paola Durante: Your next question comes from the line of Adrien Duverger with Goldman Sachs. Your line is now open. Please go ahead.

Operator: Your next question comes from the line of Adrien Duverger with Goldman Sachs. Your line is now open. Please go ahead.

Speaker #3: Good afternoon, Gianluca and Paola. Thank you very much for taking my questions. I will have two, if possible. The first one is on the wholesale channel.

Adrien Duverger: Good afternoon, Gianluca and Paola. Thank you very much for taking my questions. I will have two, if possible. The first one is on the wholesale channel. Could you please comment on the performance of that channel and the trends you are seeing for H2 2026? More specifically, what are you seeing with the order book, and if there are any timing issues to be aware of. My second question is on profitability. With the solid set of numbers today, is there anything that we should be aware of in terms of phasing of costs or investments for H2? Also, if you can please comment on your thoughts about the 2026 consensus. Do you continue to expect margin at the group level to be broadly stable year-on-year? Given these numbers, are you more confident on the full year 2027 EBIT guidance?

Speaker #3: Could you please comment on the performance of that channel and the trends you're seeing for the second half of 2026? More specifically, what are you seeing with the order book, and are there any timing issues to be aware of?

Speaker #3: My second question is on profitability. With the solid set of numbers today, is there anything that we should be aware of in terms of phasing of costs or investments for the second half?

Speaker #3: Also, if you can, please comment on your thoughts about the 2026 consensus. Do you continue to expect margin at the group level to be broadly stable year on year?

Speaker #3: And given these numbers, are you more confident in the full-year 2027 EBIT guidance? Thank you very much.

Adrien Duverger: Thank you very much.

Paola Durante: Okay, Adrien. Thank you so much. On wholesale.

Speaker #4: Okay, Adrian. Thank you so much. So, on all sales,

Gianluca Tagliabue: On wholesale, I think, hi, Adrien, we commented in July, and I go back to those comments, probably with some slight adjustments. But we expect wholesale not to be a driver of growth, to continue to contract. We expect brand by brand, Zegna in the low double digits due to icon protection, because we are very selective on distributing through third parties our recognizable items, and great attention improving the network of distribution. TOM FORD FASHION, probably we said was slightly negative. I think we could be between slightly negative and stable. Probably stable, but leveraging on what you were asking about order book, probably we could be in the stable area. And Thom Browne, negative. As I said, we are cleaning the environment. At this point, since the numbers are not as big in absolute term, I think it's important to talk about absolute because more than percentage.

Speaker #1: On wholesale, I think—hi, Adrian. We commented in July, and I go back to those comments, probably with some slight adjustments. But we expect wholesale not to be a driver of growth, to continue to contract.

Speaker #1: We expect, brand by brand, Zegna in the low double digits due to high comp protection, because we are very selective. On distributing through third parties, our recognizable items and great attention are improving the network of distribution.

Speaker #1: Tom Ford—probably, we said, was slightly negative. I think we could be between slightly negative and stable. Probably stable, leveraging on what you were asking about the order book—probably we could be in the stable area.

Speaker #1: And Tom Brown, negative—as I said, we are cleaning the environment. At this point, since the numbers are not so big in absolute terms, I think it's important to talk about absolutes more than percentages.

Speaker #1: So if you remember, in 2024, Thom Browne had €129 million or €130 million of wholesale business. Last year, that went to €77 million—a decline of roughly €50 million.

Gianluca Tagliabue: If you remember in 2024, Thom Browne had EUR 129, EUR 130 million of wholesale business. Last year went to 77. So a decline roughly of EUR 50 million. We expect this year the decline in absolute terms to be an order of magnitude much lower. So kind of half.

Speaker #1: We expect this year the decline in absolute terms to be an order of magnitude much lower—so, kind of half of the absolute decline of last year.

Paola Durante: Yes.

Gianluca Tagliabue: Of the absolute decline of last year. So I think at this point, the percentage of the business through wholesale is less impacting the overall picture, but we still see a decline, which in absolute terms will be probably 50% of the absolute decline of last year.

Speaker #1: So I think at this point, the percentage of the business through a sale is less impactful on the overall picture, but we're still seeing a decline which, in absolute terms, will probably be 50% of the absolute decline of last year.

Speaker #4: In terms of profitability, Adrian is asking if we have some phases in different phasing, and about the 2026 consensus.

Paola Durante: In terms of profitability, Adrien Duverger is asking if we have some different phasing and about 2026 consensus.

Paola Durante: In terms of profitability, Adrien is asking if we have some different phasing and about 2026 consensus.

Speaker #1: As you remember, in the call at the end of July, we said that we felt comfortable. We believe that the consensus at that time was reasonable, and that number was around €190 million.

Gianluca Tagliabue: As you remember in the call at the end of July, we said that we felt comfortable. We believe that the consensus at that time was reasonable, and that time was around EUR 190 million.

Paola Durante: It adjusted.

Speaker #1: Adjusted EBIT. Now the consensus has moved slightly up to €195 million adjusted EBIT, and we still confirm it is reasonable—even if, of course, a bit more challenging. There was a delta of €5 million, but we still believe that target is reasonable.

Gianluca Tagliabue: Adjusted EBIT. Now the consensus moved slightly up to EUR 295 million adjusted EBIT, and we still confirm it is reasonable, even if of course a bit more challenging. There was a grade of EUR 5 million, but we still believe that target is reasonable, and the same thing I would say on the guidance of 2027, so that we confirm in the same dimensions that we have said over and over in the last calls.

Speaker #1: And the same thing I would say on the guidance of 2027 so that we confirm in the same dimensions that we have said over and over in the last calls.

Speaker #4: Thank you.

Adrien Duverger: Can I just confirm for 2027, you said you were looking for an EBIT at the lower end of the range. Is that still the case? Thank you very much.

Speaker #3: Could I just confirm, for 2027, you said you were looking for EBIT at the lower end of the range. Is that still the case?

Speaker #3: Thank you very much.

Gianluca Tagliabue: It is correct.

Speaker #1: Yes, correct. That's correct.

Paola Durante: Perfect.

Adrien Duverger: Perfect. Thank you. Appreciate it.

Speaker #3: Perfect. Thank you. Appreciate it.

Adrien Duverger: Thank you. Appreciate it.

Speaker #1: It's the 250.

Gianluca Tagliabue: 250.

Speaker #4: 250, $2.2 billion, and 250—the lower end of the guidance. Yes. Thank you, Adrian. Next.

Paola Durante: EUR 2.2 billion and 250, the lower range of the guidance. Yes. Thank you, Adrien.

Paola Durante: Your next question comes from the line of Anthony Charchafji with BNP Paribas. Your line is now open. Please go ahead.

Operator: Your next question comes from the line of Anthony Charchafji with BNP Paribas. Your line is now open. Please go ahead.

Speaker #2: Your next question comes from the line of Anthony Charchafi with BNP Paribas. Your line is now open. Please go ahead.

Speaker #3: Yes, good morning. It's Anthony at BNP. Thank you very much for taking my question. The first one would be on Thom Browne, the profitability.

Anthony Charchafji: Yes, good morning. It is Anthony at BNP. Thank you very much for taking my question. The first one would be on Thom Browne profitability, so being back to profitability in H2 to be breakeven. Can you please help us understand the moving part at Thom Browne in terms of margin, if you can help us quantify the impact at the gross margin level, specifically. Also interested to know if there is a risk of inventory write down that could impact the gross margin for Thom Browne. My second question would be on marketing. Out of the EUR 68 million spent in H1, just curious to know the percentage that was allocated to the Zegna brand specifically. That would be my second question. My last question is below the line, so below EBIT, so it is a bit for housekeeping.

Speaker #3: So, being back to profitability in H2, to be at break even—can you please help us understand the moving parts at Thom Browne in terms of margin?

Speaker #3: If you can help us quantify the impact at the gross margin level specifically, and we're also interested to know if there is a risk of inventory write-down that could impact the gross margin for Tom Brown.

Speaker #3: My second question is on marketing. Out of the €68 million spent in H1, I'm just curious to know the percentage that was allocated to the Zegna brand specifically.

Speaker #3: That would be my second question. And yes, maybe my last question is below the line—so, below EBIT—so it's a bit for housekeeping.

Speaker #3: If you can, yeah, help us understand the expectation on the financial expense and the FX impact below EBIT. So, if you can give any indication on a full-year basis so we can realign correctly.

Anthony Charchafji: If you can, yeah, help us understand the expectation on the financial expense and the ForEx

Anthony Charchafji: impact below the EBIT. If you can give any indication on the full-year basis so we can realign correctly. Thank you.

Speaker #3: Thank you.

Paola Durante: Thank you, Anthony. Yes, absolutely. On Thom Browne, just to help Anthony understanding the second part and the moving parts of the second part of the year, Thom Browne profitability.

Speaker #4: Yes, absolutely. So, on Thom Browne—and just to help Anthony understand the second part and the moving part of the second half of the year—Thom Browne profitability.

Speaker #1: So, hi Anthony. As we said, we expect Tom Brown adjusted EBIT to be close to break-even. I'll tell you what the moving parts are.

Gianluca Tagliabue: Hi, Anthony. We said that we expect Thom Browne just a little bit to be close to the breakeven. I tell you which are the moving parts, and they are spread across gross margin and OpEx. There are three moving parts. The lower currency headwind, if you remember, the headwind on Thom Browne was 5 percentage points compared to almost 3 percentage points at group level. Especially being particularly exposed to Korea and Japan in proportion, they suffered from that headwind, which will be lower in the H2 of the year for both for external as well as internal factors like some price adjustments. The second part is a better and more focused open-to-buy management and goes into the topic of inventory management. We are optimizing the open-to-buy. We have started optimizing open-to-buy starting from fall/winter 2026 onwards.

Speaker #1: And they are spread across gross margin and OPEX. There are three moving parts. The lower currency headwind—if you remember, the headwind on Tom Brown was 5 percentage points compared to almost 3 percentage points at group level.

Speaker #1: So especially being particularly exposed to Korea and Japan in proportion, they suffered from that headwind, which will be lower in the second half of the year for both external as well as internal factors, like some price adjustment.

Speaker #1: The second part, it's a better and more focus open to buy management and goes into the topic of inventory management. So we are optimizing the open to buy.

Speaker #1: We have started optimizing open to buy starting from fall winter '26 onwards. So we have we will have a benefit from that part in terms of also inventory burden.

Gianluca Tagliabue: We will have a benefit from that part in terms of also inventory burden. Then there is the tight cost control, which is happening and will continue through the H2. Those are the elements. Of course, what we have said before, building the team is a fact that at a certain point gets to an inflection point. I think it could be more next year, but we start having a deceleration of cost increase. These are the moving parts on Thom Browne that let us believe about a second part, which is accretive to the bottom line.

Speaker #1: And then there is the tight cost control, which is happening and will continue through the second half. So, those are the elements. Of course, what we have said before about building the team is a fact that, at a certain point, gets to an inflection point. I think it will be more next year, but we start having a deceleration of cost increase.

Speaker #1: So these are the moving parts on Tom Brown that led us to believe about a second part, which is accretive to the bottom line.

Paola Durante: In terms of marketing, how much is related to Zegna? You can assume that more than two-third is around 70%, 75% is Zegna segment related. In terms of the lines below the EBIT to help modeling a bit full year in terms of net profit.

Speaker #4: In terms of marketing, how much is related to Zegna? You can assume that more than two-thirds, around 70% to 75%, is Zegna segment related.

Speaker #4: And in terms of the lines below the EBIT, to help with modeling a bit more fully, in terms of net profit, so as for the—as for...

Gianluca Tagliabue: As we have seen for EBIT, also for net profit, we normally generate more profit in the H2 than in the H1. In full year 2026, profit after tax will not be too far from last year, despite the fact that in 2025, we have recognized, as Paola was mentioning, financial income and ForEx gains related to the pooled option remeasurement that will not occur this year as such. To give you a sense of direction, should not be too far despite of this material last year financial income and ForEx gain that overall in the full year was a positive impact in the range of EUR 37 million.

Speaker #1: As we have seen for EBIT, also for net profit we normally generate more profit in the second half than in the first half.

Speaker #1: In full year 2026, profit after tax will not be too far from last year. Despite the fact that in 2025 we have recognized, as Paola was mentioning, financial income and effects—gains related to the pooled option remeasurement—that will not occur this year as such.

Speaker #1: So, to give you a sense of direction, it should not be too far off. Despite this material, last year's financial income and effects gained overall in the full year was a positive impact in the range of €37 million.

Paola Durante: Yes, non-monetary and non-tax. And non-taxable. As I said during the speech, of this EUR 37 million, EUR 28 million occurred in the H1. So the H1, the one that we reported, had a higher base of comparison. The second point is that the tax rate, as we said, as normal in the H2 for the group is lower. So it will-

Speaker #4: Yes. And no monetary

Speaker #1: and no tax.

Speaker #4: And non-taxable. And as I said during this speech, of which 37,028,000 occurred in the first part of the year. So the first part, the one that we reported, had a higher base of comparison.

Paola Durante: And non-taxable. As I said during the speech, of this EUR 37 million, EUR 28 million occurred in the H1. So the H1, the one that we reported, had a higher base of comparison. The second point is that the tax rate, as we said, as normal in the H2 for the group is lower. So it will-

Speaker #4: And the second point is that the tax rate, as we said, as normal in the second part of the year for the group, is lower.

Speaker #4: So it will.

Gianluca Tagliabue: I add also one point as a positive, less demanding base of comparison. If you remember last year, at the end of the year, we had also the impact that was recorded of the Saks group credit write downs which of course this year we are not expecting.

Speaker #1: I had also one point as a positive, less demanding base of comparison. If you remember, last year at the end of the year we also had the impact that was recorded of the Saks Group credit right-off.

Speaker #1: Which, of course, this year we are not expecting.

Speaker #3: Thank you very helpful.

Anthony Charchafji: Thank you. Very helpful.

Speaker #4: Thank you, one.

Paola Durante: Thank you, Anthony. The next one.

Paola Durante: Your next question comes from the line of Oliver Chen with TD Cowen. Your line is now open. Please go ahead.

Operator: Your next question comes from the line of Oliver Chen with TD Cowen. Your line is now open. Please go ahead.

Speaker #1: Your next question comes from the line of Oliver Chen with TD Cowen. Your line is now open. Please go ahead.

Oliver Chen: Hi, Gi and Luca and Paola. Thank you very much. As you think about Americas, what is happening there in terms of the key brands, and is the wealth effect being a positive driver? Your comments on China are also very encouraging. Do you expect a lot of those trends to stick in terms of the consumer sentiment is somewhat volatile in China, but the Zegna brand has executed clearly really well. My second question on Thom Browne, the wholesale network taking longer, why is that true? Why is that happening, and what have been your learnings in terms of that happening? I know the brand continues to evolve and has a special artistic place in the fashion universe as well. Thank you.

Oliver Chen: Hi, Gianluca and Paola. Thank you very much. As you think about Americas, what is happening there in terms of the key brands, and is the wealth effect being a positive driver? Your comments on China are also very encouraging. Do you expect a lot of those trends to stick in terms of the consumer sentiment is somewhat volatile in China, but the Zegna brand has executed clearly really well. My second question on Thom Browne, the wholesale network taking longer, why is that true? Why is that happening, and what have been your learnings in terms of that happening? I know the brand continues to evolve and has a special artistic place in the fashion universe as well. Thank you.

Speaker #3: Hi, Gianluca and Paola. Thank you very much. As you think about the Americas, what's happening there in terms of the key brands, and is the wealth effect being a positive driver?

Speaker #3: And your comments on China are also very encouraging. Do you expect a lot of those trends to stick, in terms of consumer sentiment? It's somewhat volatile in China, but the Zegna brand has executed clearly really well.

Speaker #3: And the second question on Tom Brown: the wholesale network is taking longer—why is that true? Why is that happening? And what have been your learnings in terms of that happening?

Speaker #3: I know the brand continues to evolve and has a special, artistic place in the fashion universe as well. Thank you.

Speaker #4: Thank you, Oliver. As always, very interesting. The first one is on US and GCR. I understood them mainly really focused on the Zegna brand.

Paola Durante: Thank you, Oliver, as always, very interesting. The first one is on US and GCR. I understood mainly really focused on Zegna brand, and the second one on Thom Browne. To Gianluca.

Speaker #4: And the second one on Thom Browne. Gianluca.

Gianluca Tagliabue: Hi, Oliver. I do not enter too much in the breakdown by nationality because I think we will do it at the end of Q3, but I give you a sense that we are not seeing a significant difference in trend by nationality, by markets. We keep on seeing a positive performance in America, of course, driven by the Zegna solid positioning, but also TOM FORD FASHION is doing well. And overall, with the North American consumers, we keep on seeing, also in July and August, a very solid double-digit growth. So no material difference in the trajectory on America. On China, I think, as I said before, there is, in the marketplace, volatility. Probably Zegna is moving, as I said, at a different pace because it is gaining market share, and I think that the recipe there is really the focus.

Speaker #1: Hi Oliver. I won't go too much into the breakdown by nationality because I think we'll do that at the end of Q3, but I can give you a sense that we are not seeing a significant difference in trends by nationality or by markets.

Speaker #1: We keep on seeing a positive performance with in America. Of course, driven by the Zegna Ford is doing well. And overall, with the North American consumers, we are we keep on seeing also in July and August a very solid double digit growth.

Speaker #1: So, no material difference in the trajectory in America. On China, I think, as I said before, there is marketplace volatility. Probably Zegna is moving, as I said, at a different pace because it's gaining market share, and I think that the recipe there is really the focus.

Speaker #1: I think Angelo and Dedo, and the team overall, have picked their battles, and the battles were and are the untapped opportunities of the Zegna brand, which was underrepresented in triple stretch, underrepresented in made to measure, underrepresented in some other categories.

Gianluca Tagliabue: I think Angelo and Edo and the team overall have picked their battles, and the battles were and are the untapped opportunities of Zegna brand, which was underrepresented in Triple Stitch, underrepresented in Su Misura, underrepresented in some other categories, and I think that part is playing a game. And broadening the picture, I think that what encourages us is that overall, America, GCR, Europe, Zegna brand is seeing a growth on number of consumers and is seeing a growth in volumes in the H1 of this year. Because of course, we are losing some volume in some categories, but the categories that are key for us, whether it is shoes and not only Triple Stitch, but also 232 and the other models, knitwear, five-pocket pants, those are categories that are solidly growing. Eyewear, fragrances.

Speaker #1: And I think that part is playing a game. And broadening the picture, I think that what encourages us is that overall, America, GCR, Europe, Zegna brand is seeing a growth in the number of consumers.

Speaker #1: And is seeing a growth in volumes in the first half of this year. Of course, we are losing some volume in some categories.

Speaker #1: But the categories that are key for us—whether it's shoes, and not only Triple Stitch but also 232 and the other models, knitwear, five-pocket pants—those are categories that are solidly growing.

Speaker #1: I wear fragrances.

Paola Durante: Thank you.

Speaker #4: Thank you.

Speaker #1: So, this we are seeing, of course, all our strategies at the top of the pyramid, but this is creating a very positive snowball effect in the lower tier of clients, and the number of clients is growing.

Gianluca Tagliabue: This we are seeing. Of course, all our strategy is top of the pyramid, but this is creating a very positive noble effect in the lower tier of clients, and the number of clients is growing. So it is solid. It is not picking the top of the pyramid, it is squeezing the level. So I want to make it sure that it is clear.

Speaker #1: So it's solid. It's not picking the top of the pyramid and squeezing the level. So I want to make sure that it's clear.

Paola Durante: On Thom Browne, why it's taking longer? That was the question.

Speaker #4: On Thom Browne, why is it taking longer? That was the question.

Gianluca Tagliabue: On Thom Browne, it's taking longer because I think the fact that we are reshaping entirely the senior leadership team, it's a point that probably the team was very well-versed in wholesale-driven model. The team, like teenagers, at a certain point, you need to change habits, patterns. I think we probably needed to change the team almost entirely, and infuse capabilities on the retail side. We are working, as I said before, on open-to-buy assortment, and that's another direction. We are also, with Sam, changing, but it's early to say some components of our future assortment. So, definitely it's taking some time. I think I'm not putting any excuse. I think it took some time also to make the turnaround of Zegna.

Speaker #1: On Tom Brown, it's taking longer because I think the fact that we are reshaping entirely the senior leadership team—it's a point that probably the team was very well versed in a wholesale-driven model, and the team, like teenagers, at a certain point you need to change habits and patterns.

Speaker #1: I think we probably needed to change the team almost entirely, almost entirely, and infuse capabilities on the retail side. We are working, as I said before, on open-to-buy assortment, and that's another direction.

Speaker #1: We are also with Sam changing, but it's early to say some components of our future assortment. So definitely, it's taking some time. I think I'm not putting any excuse.

Speaker #1: I think it took some time also to make the turnaround of Zegna. We probably were optimistic in the change and the revamp and relaunch of Thom Browne, but I reaffirm that we are still positive and we believe that Sam is making the right changes and the right interventions in collection, merchandising, and marketing. The goal is overall to widen the base, above and beyond the lovers and the niche of the brand.

Gianluca Tagliabue: We probably were optimistic in the change of the revamp and relaunch of Thom Browne, but I reaffirm that we are still positive, and we believe that Sam is making the right changes and the right intervention in collection merchandising, in marketing. The goal is overall to widen the base above and beyond the lovers and the niche of the brand. We believe that we have the elements, investing on the Preppy Americana codes, creating further options for new clients to come into the brand, and this will be probably, in the next collections, more visible, not yet out there. So I just tease that we are working on both marketing and collection in order to welcome more people into the brand. The brand

Speaker #1: And we believe that we have the elements, investing on the preppy Americana codes, creating further options for new clients to come into the brand, and this will be probably, in the next collections, more visible—not yet out there.

Speaker #1: So I just teased that we are working on both marketing and collection in order to welcome more people into the brand. The brand has a basics, showed as appeal; we just need to create more options for people to come in.

Oliver Chen: Okay, thanks.

Gianluca Tagliabue: as ASICS showed, has appeal. We need just to create more options for people to come in.

Speaker #3: Thanks. And one follow-up on Tom Ford—clearly, it has really strong awareness. As you think about product and Tom Ford, the women's ready-to-wear, the daywear, the leather outerwear, and made to measure—what should we focus on in terms of where you are with the path ahead? And what are the biggest opportunities within product for Tom Ford?

Oliver Chen: Thanks. One follow-up. TOM FORD FASHION clearly has really strong awareness. As you think about product and TOM FORD FASHION, the women's ready-to-wear, the day wear, the leather outerwear, and Su Misura, what should we focus on in terms of where you are with the path ahead and the biggest opportunities within product at TOM FORD FASHION? Thank you.

Speaker #3: Thank you.

Speaker #1: Well, there are short-term opportunities along with mid-term opportunities. I'm not saying long-term, mid-term opportunities. In the short-term opportunities, we still have a lot—growing in fruits is more in the apparel.

Gianluca Tagliabue: Well, there is short-term opportunities, along mid-term opportunities. I am not saying long-term, mid-term. In the short-term opportunities, we still have a lot. The low-hanging fruits is more in the apparel. I think we are creating

Speaker #1: I think we are creating more opportunities for higher frequency of use in women’s daywear. We are using the filiera capabilities to achieve higher results, and that's growing quite nicely.

Paola Durante: Well

Gianluca Tagliabue: more opportunities for higher frequency of use in women in day wear. We are using the filiera capabilities to have higher, and that is growing quite nicely, the Su Misura in TOM FORD FASHION. We launched in the H1 of the year, women tailoring, that is a unique offer proposition in the marketplace because if you want to have a women tuxedo or a women tailor on measure, TOM FORD FASHION is the best option in the marketplace. We launched the leather outer, which is an iconic offering for TOM FORD FASHION, also on Su Misura, amplifying colors and materials. So I think these are the low-hanging fruits. Of course, the mid-term goal and the untapped opportunity is getting a solid platform on women bags. The team is working on that.

Gianluca Tagliabue: We are using the filiera capabilities to have higher, and that is growing quite nicely, the Su Misura in TOM FORD FASHION. We launched in the H1 of the year, women tailoring, that is a unique offer proposition in the marketplace because if you want to have a women tuxedo or a women tailor on measure, TOM FORD FASHION is the best option in the marketplace. We launched the leather outer, which is an iconic offering for TOM FORD FASHION, also on Su Misura, amplifying colors and materials. So I think these are the low-hanging fruits. Of course, the mid-term goal and the untapped opportunity is getting a solid platform on women bags. The team is working on that. We are not yet there, and we are aware, but these are the opportunities we see up there and where we need to keep on working.

Speaker #1: The made-to-measure in Tom Ford, we launched in the first half of the year women’s tailoring. It's a unique offer proposition in the marketplace because if you want to have a women’s tuxedo or a women’s tailleur on measure, Tom Ford is the best option in the marketplace.

Speaker #1: We launched the leather outer, which is an iconic offering for Tom Ford, also on make-to-measure, amplifying colors and materials. So I think these are the glowing fruits.

Speaker #1: Of course, the mid-term goal and the untapped opportunity is getting a solid platform on women's bags. The team is working on that. We are not yet there, and we are aware, but this is the opportunity we see up there and where we need to keep on working.

Gianluca Tagliabue: We are not yet there, and we are aware, but these are the opportunities we see up there and where we need to keep on working.

Speaker #3: Thank you. Best regards.

Oliver Chen: Thank you. Best regards.

Speaker #4: Thank you, Oliver. Next.

Paola Durante: Thank you, Oliver. Next.

Paola Durante: Your next question comes from the line of Chris Gao with CLSA. Your line is now open. Please go ahead.

Operator: Your next question comes from the line of Chris Gao with CLSA. Your line is now open. Please go ahead.

Speaker #1: Your next question comes from the line of Chris Gow with CLSA. Your line is now open. Please go ahead.

Speaker #4: Thank you. Hi, Gianluca. Hi, Paola. Thanks for taking my question. I have three, if I may. So, my first question is a quick one regarding tourist demand.

Chris Gao: Thank you. Hi, Gianluca. Hi, Paola. Thanks for taking my question. I have three, if I may. My first question is a quick one regarding tourist demand. Just wondering, how does the tourist demand among your key nationalities look like heading into July and August? Any comments on that? My second question is regarding your Chinese demand guidance. Going back to earlier this year, remember the guidance was largely flattish this year, but since your GCR performance was already 7% organic in the H1 and your comments on GCR trends during the summer is still solid, would you consider lifting the guidance for your Chinese demand for the FY2026, and how should we also

Speaker #4: So I was just wondering, how does the tourist demand among your key nationalities look going into July and August? Any comments on that? And my second question is regarding your Chinese demand guidance.

Speaker #4: If we go back to earlier this year, remember the guidance was largely flattish for this year. But since your GCR performance was already 7% organic in the first half, and your comments on GCR trends during the summer are still solid.

Speaker #4: So, would you consider lifting the guidance for your Chinese demand for FY26, and how should we also look into FY27? My last question is regarding your store space contribution by brand in 2026 and 2027.

Paola Durante: I didn't hear

Chris Gao: look into the 2027?

Chris Gao: look into the 2027? My last question is regarding your space contribution by brand in 2026 and 2027. Since we're approaching the end of 2026, do you have any changes of your space contribution plans? Also you mentioned some 10 net closures of Zegna stores in China over time. What will be the progress by the end of 2026, if we may ask? Thank you.

Paola Durante: One.

Chris Gao: My last question is regarding your space contribution by brand in 2026 and 2027. Since we're approaching the end of 2026, do you have any changes of your space contribution plans? Also you mentioned some 10 net closures of Zegna stores in China over time. What will be the progress by the end of 2026, if we may ask? Thank you.

Speaker #4: So, since we're approaching the end of 2026, do you have any changes to your space contribution plans? And also, you mentioned some 10-store net closures of senior stores in China over time.

Speaker #4: So, what will be the progress by the end of '26, if we may ask? Thank you. Chris, I hope we got all your questions, because there were many. And so, in terms of nationalities, I would say Gianluca has commented on the current trend, and I will leave the comments to what he said, also in terms of nationality.

Paola Durante: Chris, I hope we get all your questions because there were many. In terms of nationalities, I would say Gianluca has commented on the current trend, and I will leave the comment to what he said, also in terms of nationality. Particularly for Zegna, he mentioned that we-

Speaker #4: And particularly for Zegna, he mentioned that we are focused on the tourist demand—on tourists. We're focused on the tourist demand, yes. I would say I wouldn't really add much more, Chris, but one thing that you might remember is that in July, we commented that there was a little bit of softness in Europe due to tourists, which was probably related to the World Cup, and this was actually the case because August saw an improvement. But I wouldn't go much more in detail.

Chris Gao: Yes, we are focused on the tourist demand.

Paola Durante: On tourism.

Chris Gao: We are focused on the tourist demand. Yes.

Paola Durante: I wouldn't really add much more, Chris, but one thing that you might remember is right in July, we commented that there was a little bit of softness in Europe due to tourists, which was probably related to World Cup, and it was actually the case because August saw an improvement. But I wouldn't go much more in details. In any case, you know that for us, tourists are, yes, important, but less than for others. In any case, I would stop on this comment for tourist. While on the Chinese demand, I think you said you ask if we change our guidance for year-end because it was a flattish, and of course.

Speaker #4: In any case, you know that for us, tourists are, yes, important, but less so than for others. In any case, I would stop on this comment about tourists.

Speaker #4: While on the Chinese, demand you I think you said you ask if we change our guidance for year end because it was a flattish and of course.

Gianluca Tagliabue: Well, hi, Chris. In the H1, we finished the H1 at organic +6.8%. Organic wise, we keep on having, on Zegna, as I said before, a good trajectory on Thom Browne, a soft trajectory. Overall, as I said before, we don't see a big change in pattern, so we keep on having a positive performance on I would say positive performance. So probably the flattish can result a cautious outlook, although, of course, we are very attentive in monitoring the evolution also from a consumer mood about the new taxes on offshore investment. So that's the lingering question mark, whether in the coming months it may have an impact. But so far, we stay in the positive territory.

Speaker #1: Well, hi Chris. In the first half, we finished the first half at plus organic, plus 6, plus 6.8. Organic-wise, we keep on having, on Zegna as I said before, a good trajectory; on Thom Browne, a soft trajectory.

Speaker #1: Overall, as I said before, we don't see a big change in pattern, so we keep on having a positive performance—I would say positive performance.

Speaker #1: So probably the flattish can result in a very cautious outlook. Although, of course, we are very attentive in monitoring the evolution, also from a consumer mood, about the new taxes on offshore investment.

Speaker #1: So that's the lingering question mark—whether, in the coming months, it may have an impact. But so far, we stay in the positive territory.

Paola Durante: Absolutely.

Speaker #4: Absolutely.

Gianluca Tagliabue: Space, we said Zegna is, as you mentioned, we are going to close, and that's not only this year, but we will take more because we are not closing just for the anticipating the closure by the lease. We are expecting the lease expire. So it will be little by little, the reduction of some stores in China. Overall, the picture of space will be next year more affecting TOM FORD FASHION than any other brand.

Speaker #1: So, as we said, Zegna, as you mentioned, we are going to close some stores. That’s not only this year; there will be more to come, because we are not closing just to anticipate the closure by the lease.

Speaker #1: We are expecting the lease to expire, so there will be, little by little, a reduction of some stores in China. Overall, the picture of space for next year will affect Tom Ford more than any other brand.

Speaker #4: In the positive sense.

Chris Gao: In the positive sense.

Paola Durante: In the positive sense.

Speaker #1: On the positive side, on Zegna and Thom Browne, it will not be material. We have, on Tom Ford instead, four openings from now through January, which are material.

Gianluca Tagliabue: On the positive sense. On Zegna and Thom Browne will not be material. We have on TOM FORD FASHION instead, four openings from now through January, which are material. I recall them, are three in US, which is the house of the brand. It is Costa Mesa, which is a beautiful location in the mall. It will be in October. We have San Diego, which will be again around October, and Bal Harbour, Miami, again, same, more or less September, October. Then finally, we will have in January, end of January, the flagship in Paris, which will represent the new house of the brand because it will carry a new store concept. The new store concept.

Speaker #1: I recall them. There are three in the US, which is the house of the brand. It's Costa Mesa, which is a beautiful location in the mall.

Speaker #1: Maybe in October, we have San Diego, which will be again around October, and Palermo or Miami again, more or less September or October. And then, finally, we will have, at the end of January, the flagship in Paris, which will represent the new house of the brand because it will carry a new store concept.

Speaker #1: The new store concept.

Chris Gao: That is very helpful.

Speaker #4: That's very helpful. Thank you, Chris. And the next question.

Paola Durante: Thank you, Chris. Next question.

Paola Durante: Your next question comes from the line of Jean D'Ange with Oddo BHF. Your line is now open. Please go ahead.

Operator: Your next question comes from the line of Jean Danjou with ODDO BHF. Your line is now open. Please go ahead.

Speaker #1: Your next question comes from the line of Gian d'Anjou with Auto DHS. Your line is now open. Please go ahead.

Speaker #5: Good afternoon. I had two questions. The first one is, could you be a bit more precise on the tax rate for the full year 2026? And then the second one is on the medium-term margin for the Zegna segment.

Jean D'Ange: Good afternoon. I had two questions. The first one is, could you be a bit more precise on the tax rate full year 2026? The second one is on the medium-term margin for the Zegna segment. You seem to be on the verge to be at 15% in 2026. Obviously, the brand has a lot of momentum. It is evolving positively on the leverage side. How much more can you get on the margin on Zegna segment? Would it be reasonable to look at the margin of Brunello Cucinelli to get a sense of where you could go on the Zegna segment medium term?

Jean Danjou: Good afternoon. I had two questions. The first one is, could you be a bit more precise on the tax rate full year 2026? The second one is on the medium-term margin for the Zegna segment. You seem to be on the verge to be at 15% in 2026. Obviously, the brand has a lot of momentum. It is evolving positively on the leverage side. How much more can you get on the margin on Zegna segment? Would it be reasonable to look at the margin of Brunello Cucinelli to get a sense of where you could go on the Zegna segment medium term?

Speaker #5: You seem to be on the verge of reaching 15% in 2026. Obviously, the brand has a lot of momentum. It's evolving positively on the leverage side.

Speaker #5: How much more can you get on the margin on the Zegna segment? Would it be reasonable to look at the margin of Brunello Cucinelli to get a sense of where you could go on the Zegna segment medium term?

Speaker #4: Thank you, Gian. On tax rate, as I commented, the normal tax rate for our group is in the region of 28% to 30%.

Paola Durante: Thank you, Jean. On tax rate, as I commented, normal tax rate for our group in the region of 30%, 28%, 30%. We do not expect this year to be different from that at year-end, of course.

Speaker #4: We don't expect this year to be different from that at year-end, of course. So, in terms of the Zegna segment, I will leave it to Gianluca.

Jean D'Ange: Okay.

Jean Danjou: Okay.

Paola Durante: In terms of the Zegna segment, I leave to Gianluca.

Speaker #1: As we have said many times, we want to reach 15%. Of course, now we need to look beyond the 15% goal, and naturally, the sweet spot for us is to be between 15 and 20%.

Gianluca Tagliabue: As we have said many times, we want to reach 15%. Of course, now we need to look behind the 15% goal. Of course, the sweet spot for us is to be between 15% and 20%. Of course, you mentioned Brunello, which is in that range. We do more or less, it is the same mechanics, the same markup, and the same size curve, which means obsolescence of inventory. I think that is the number. We need to move towards 20%. That is our journey, the next journey, which will take time. It is not a one-year, two years, three years goal, but we clearly have not finished the upgrade of our margin on the Zegna segment.

Speaker #1: Of course, you mentioned Brunello, which is in that range. We do, more or less, it's the same mechanics, the same markup, and the same size curve, which means obsolescence of inventory.

Speaker #1: And so I think that is the number we need to move towards—the 20%. That is our journey, the next journey, which will take time.

Speaker #1: It's not a one-year, two-year, or three-year goal, but we clearly have not finished the upgrade of our margin on the Zegna segment.

Speaker #5: Thank you.

Jean D'Ange: Thank you.

Jean Danjou: Thank you.

Speaker #4: Thank you. And next, and maybe the last one.

Paola Durante: Thank you. Next and maybe last one.

Paola Durante: Your final question comes from the line of Maria Meita with Bernstein. Your line is now open. Please go ahead.

Operator: Your final question comes from the line of Maria Meita with Bernstein. Your line is now open. Please go ahead.

Speaker #1: Your final question comes from the line of Maria Mata with Bernstein. Your line is now open. Please go ahead.

Speaker #6: Good afternoon, and thank you for taking my questions. I have two. First, some clarifications on Zegna. Do you have any store openings planned for the second half of the year?

Maria Meita: Good afternoon, and thank you for taking my questions. I have two. First, a clarification on Zegna. Do you have any store openings planned for the H2 of the year? Second on TOM FORD FASHION, given the strong progression to date, but also your ongoing investments, you mentioned marketing. When do you expect the brand to break even? Thank you.

Speaker #6: And then, second, on Tom Ford: Given the strong progression to date, but also your ongoing investments—you mentioned marketing—when do you expect the brand to break even?

Speaker #6: Thank you.

Speaker #4: Thank you, Maria. I'll leave to Gianluca the store openings for the second part of the year for Zegna, but we just opened Arbol City in reality, which is.

Paola Durante: Thank you, Maria. I leave to Gianluca the store opening for the second part of the year for Zegna. We just opened Harbour City in reality, which is-

Gianluca Tagliabue: Yeah, we did a couple of important openings in China. This goes back to what was mentioned before by Chris. Of course, we are reducing the size of presence Greater China, but we are reinvesting in fewer, better doors. The example has been in the last couple of months, we opened a second store in Shenzhen.

Speaker #1: Yeah. We did a couple of important openings in China, and this goes back to what was mentioned before by Chris. Of course, we are reducing the size of our presence in Greater China, but we are reinvesting in fewer, better doors.

Speaker #1: For example, in the last couple of months, we opened a second store in Shenzhen Bay, in Shenzhen. In Shenzhen Bay, we opened a very meaningful store, and we are proud of the store in Arbol City, Hong Kong.

Paola Durante: Yeah, Shenzhen.

Gianluca Tagliabue: Shenzhen Bay. We opened a very meaningful, and we are proud of the store in Harbour City, Hong Kong.

Speaker #4: You opened Madrid.

Paola Durante: We opened Madrid.

Speaker #1: We opened Madrid. For the remainder of the year, we don't have material openings. We will have others next year—Geneva and others—but we will disclose more in the upcoming calls.

Gianluca Tagliabue: We opened Madrid. In the remainder of the year, we do not have material openings. We will have other next year, Geneva and others, but we will disclose more in the upcoming calls. We have definitely, as I said before, important openings on TOM FORD FASHION in the next four, five months. Those are the big openings that we have to accomplish. Zegna has done these three important openings in the last few months.

Speaker #1: We are definitely, as I said before, expecting important openings on Tom Ford in the next four to five months. Those are the big openings that we have to accomplish.

Speaker #1: Zegna has made three important openings in the last few months.

Paola Durante: When will TOM FORD FASHION be break even?

Speaker #4: And Tom Ford, when it could be break-even.

Gianluca Tagliabue: Let's start from 2026. We expect the journey of TOM FORD FASHION to regain a more interesting level of P&L in the H2 of this year. In the H2 of last year, TOM FORD FASHION recorded a positive adjusted EBIT, and we believe that this will be the case also in the H2 of this year. Therefore, we expect an adjusted EBIT for full year 2026 for TOM FORD FASHION in the region of a few million negative, and that is the outlook for this year. I will pause for the time being on this, and it is one step at a time.

Speaker #1: Let's start from 2026. We expect the journey of Tom Ford to regain a more interesting level of P&L in the second half of this year.

Speaker #1: In the second half of last year, Tom Ford recorded a positive adjusted EBIT, and we believe that this will be the case also in the second half of this year.

Speaker #1: Therefore, we expect an adjusted EBIT for full year '26 for Tom Ford in the region of a few million negative, and that is the outlook for this year.

Speaker #1: I would pause for the time being on this, and it's one step at a time.

Paola Durante: Great. So I think we reached the end of.

Alice Poggioli: Great. So I think we reached the end of.

Speaker #4: Great. So I think we've reached the end of our call. One second—we forgot to mention that we're going to open the new St.

Gianluca Tagliabue: One second. We forgot to mention that we are going to open the new St. Moritz store in the second part of the year. I got that.

Paola Durante: One second. We forgot to mention that we are going to open the new St. Moritz store in the second part of the year. I got that.

Speaker #4: Moritz store in the second part of the year. I forgot.

Gianluca Tagliabue: Yeah. We are opening in St. Moritz, the new store.

Speaker #1: Yeah, yeah. The second 'yeah.' We are opening St. Moritz, the new...

Speaker #4: Yeah. That's.

Speaker #1: The new store—it will be a nice store—that we open in St. Moritz in December. And, of course, you mentioned San Diego also for the Zegna brand.

Paola Durante: It will be a nice store that we open in St. Moritz in December. Of course, you mentioned San Diego also for the Zegna brand. Sorry, Alicia, I interrupted you. Now I think we reached the end of our call. Let me just remind you that our next release will be on 22 October, so our silent period will begin on 1 October. Thank you everyone for attending today's call, and if you need any further clarification, of course, do not hesitate to contact us. Have a nice rest of the day. Ciao, everyone.

Paola Durante: It will be a nice store that we open in St. Moritz in December. Of course, you mentioned San Diego also for the Zegna brand. Sorry, Alice, I interrupted you.

Speaker #1: Sorry Alicia I interrupted you.

Alice Poggioli: Now I think we reached the end of our call. Let me just remind you that our next release will be on 22 October, so our silent period will begin on 1 October. Thank you everyone for attending today's call, and if you need any further clarification, of course, do not hesitate to contact us. Have a nice rest of the day. Ciao, everyone.

Speaker #4: We have reached the end of our call. Let me just remind you that our next release will be on October 22nd, so our silent period will begin on October 1st.

Speaker #4: Thank you, everyone, for attending today's call. If you need any further clarification, please do not hesitate to contact us. Have a nice rest of the day.

Speaker #4: Ciao, everyone. Ciao to everybody. Thank you.

Paola Durante: Ciao to everybody. Thank you.

Paola Durante: This concludes today's call. Thank you for attending. You may now disconnect.

Operator: This concludes today's call. Thank you for attending. You may now disconnect.

More ZGN earnings call transcripts

Browse all earnings call transcripts

Q2 2026 Ermenegildo Zegna NV Earnings Call

Request TrialDemo

Ermenegildo Zegn

Earnings