Zegna Posts 20% Profit Gain to €109M as Shares Slide 18%
Ermenegildo Zegna NV posted 20% profit to €109 million in 2025, gross margin up 90 bps to 67.5% with net cash surplus of €52 million. Shares slid 18% since late February as Middle East conflict clouds demand, currency headwinds shave ~2% profit; Tom Ford segment posted a €16 million adjusted EBIT loss.
1. Full Year 2025 Financial Highlights
Ermenegildo Zegna NV posted a 20% rise in net profit to €109 million for the year ended December 2025, while gross margin improved 90 basis points to 67.5%. The group generated €82 million in free cash flow and ended the year with a net cash surplus of €52 million, reversing prior indebtedness.
2. Segment Performance and Collaborations
The Tom Brown sneaker collaboration with Aix exceeded visibility and revenue targets, whereas the Tom Ford fashion segment incurred a €16 million adjusted EBIT loss. Wholesale revenues in the Tom Brown segment fell, yielding only €1 million of adjusted EBIT.
3. Middle East Conflict and Market Outlook
Geopolitical tensions in the Middle East have introduced demand uncertainty and operational challenges in a region that, while a relatively small contributor to sales, plays a strategic role. Currency fluctuations are expected to trim roughly 2% from overall profitability in the current fiscal year.
4. Share Reaction and Investor Sentiment
Shares of Zegna have dropped 18% since late February as investors recalibrate growth forecasts amid regional tensions and currency headwinds. Despite resilient trends in China, Europe and the Americas, market visibility remains constrained until the conflict stabilizes.