Gucci’s creative director Michele resigns – source from Reuters

©Reuters. FILE PHOTO: The 79th Venice Film Festival – Premiere screening of the film ‘Don’t Worry Darling’ out of competition – Red Carpet Arrivals – Venice, Italy, September 5, 2022 – Alessandro Michele attends. REUTERS/Yara Nardi

By Mimosa Spencer and Dominique Vidalon

PARIS (Reuters) – Gucci creative director Alessandro Michele is leaving star label Kering (EPA:) after seven years, a source said on Wednesday, confirming previous reports.

Kering was expected to officially confirm the news quickly, the source said, adding that there had been tensions between the designer and Kering’s top management.

Both Kering and Gucci declined to comment.

Citing unnamed sources, Women’s Wear Daily (WWD) first announced Michele’s departure in a report overnight.

Kering shares opened up 2% on Wednesday before paring gains, with analysts saying a new designer could help revive sales. They were down 0.7% in early afternoon trading.

“After seven years at the helm of Gucci’s creative engine, it may be time for a change and a consensus appears to be forming among institutional investors that a fresh approach is needed to revitalize the brand,” said RBC- Analysts in a statement.

“Overall, the notion of a change in Gucci’s creative lead is likely to be welcomed positively by the market and Kering’s share price,” they added.

Michele, a former accessories designer who took over the top creative role at Gucci in 2015, is credited with reigniting the label’s popularity with extravagant and gender-defying styles.

Together with CEO Marco Bizzarri, he led a period of rapid growth between 2015 and 2019, in which profits almost quadrupled and revenues nearly tripled.

But in recent quarters, Gucci, which accounts for the bulk of Kering’s earnings, began to lag its peers, with its performance in the important Chinese market raising concerns for investors.

WWD quoted a source as saying Michele was asked to “initiate a major design change” to ignite a fire under the brand and that the designer failed to comply with the request. The WWD report states that Kering chairman and CEO François-Henri Pinault is looking for a change of pace for the brand.

“Gucci is in the midst of a complex transition aimed at elevating the brand,” said Citi analyst Thomas Chauvet.

“While Kering management has historically been patient in executing turnarounds, the nomination of a new designer could accelerate the pace of change and redefine the brand’s aesthetic.”