German menswear specialist Hugo Boss saw another tough quarter between April and June this year. Second-quarter sales at the company slid 10 percent to 905 million euros, a drop of 9 percent in currency-neutral terms. This was slightly below market expectations of 907 million euros.
“Sales remained impacted by our strategic realignment and a challenging external environment,” Hugo Boss chief executive officer Daniel Grieder said in a statement.
Grieder emphasized again that this was part of the company’s new “quantity over quality” plan, launched last year when it became clear more ambitious targets of 5 billion in sales per annum were not going to be met. Hugo Boss is not expected to return to growth until 2027.
“The strategy is already translating into tangible benefits and creating a structurally stronger Hugo Boss,” Grieder noted, after the company started 2026 by reporting its worst quarterly sales in around two years.
Revenues in Hugo Boss’ home market of Europe, the Middle East and Africa fell 14 percent in the second quarter to 532 million euros. This reflected lower demand in major markets like Germany, the U.K. and France, as well as lower tourism flows and the conflict in the Middle East, it said.
Hugo Boss expects the sales slump in its largest market to continue for the rest of the year, forecasting a percentage drop in the high-single digits to low teens for the full year.
In the Americas, sales remained flat at 236 million euros and in the Asisa Pacific region, sales slid 6 percent to 116 million euros.
In terms of product categories, sales of the company’s more casual brand, Hugo, decreased by 14 percent. This category is currently undergoing major changes.
Hugo Boss’ more formal offerings under the Boss label, which makes up most of the company’s business, dropped 9 percent. This was due to the current repositioning strategy, the company said.
The Boss womenswear segment is also going through a major overhaul and this has impacted sales figures too, Hugo Boss added. The womenswear category has not typically made up a large part of the Boss income until now.
Despite the measures Hugo Boss has taken to become more profitable and streamline operations, which has included closing stores and shrinking inventories, the company’s earnings before income and taxes, or EBIT, fell 28 percent to 59 million euros from 81 million euros over the same period last year.
That represents a profit margin – or EBIT as a percentage of sales – of 6.5 percent, down from 8.5 percent during the same period last year. At the same time, EBIT was above market consensus, which stood at 52 million euros.
Although Hugo Boss is currently in the middle of a strategic repositioning and management has previously said the sales drops are all part of their plan, the second quarter results may worry. One of Hugo Boss’ major shareholders, the British company Frasers Group, has made shareholders an offer that could see Frasers take over the whole company.
Hugo Boss issued a statement in early July saying the price Frasers was offering per share, 38 euros, was not commensurate with the company’s potential and that shareholders should reject it. They have until Aug. 13 to decide.
On the back of the second quarter results, Hugo Boss confirmed guidance for the year. It expects sales will fall in the mid- to high-single digits throughout the year and operating profit will decrease to between 300 million and 350 million euros.
