EssilorLuxottica SA’s third-quarter revenue slightly missed estimates on the back of a negative performance from sunglasses in North America and worsening economic conditions in China.
Revenue for three months ended September rose 4 percent year-on-year at constant exchange rates to €6.44 billion ($7 billion), compared with Bloomberg consensus figures of 5.3 percent and €6.54 billion respectively.
North America, where the French-Italian group generates about half of its sales, grew 1.6 percent compared with the same period the previous year, hampered by the negative performance from sunglasses the company linked to an “uncertain macroeconomic backdrop,” according to a statement on Thursday.
The performance at Sunglass Hut, while still negative, showed initial signs of improvement in September, the company said.
Sales in the Asia-Pacific region rose 5 percent to €794 million, with China more than offsetting the negative performance of Hong Kong, the company said. Results for greater China were driven by Stellest prescription lenses, with sales up 40 percent compared with the same quarter last year.
The Ray-Ban maker is investing in connectivity and artificial intelligence features to embed in its glasses while focusing on medical technologies. EssilorLuxottica said connected glasses produced through a Ray-Ban partnership with Meta Platforms Inc. were one of the strongest third-quarter drivers in North America.
Speculation had heightened over the future of that venture when chief executive officer Francesco Milleri confirmed that Meta was weighing a purchase of a minority stake in the eyewear maker.
While Meta Co-Founder Mark Zuckerberg said last month that the US group’s interest in EssilorLuxottica is “not going to be a major thing,” he also said an eventual stake acquisition would be a “nice gesture” in light of the long-term partnership. To date no purchase has been disclosed.
With lenses becoming a strategic technological component, EssilorLuxottica has also recently disclosed a 5 percent stake in Nikon Corp., building on an eyewear joint venture with the Japanese company dating back more than 20 years.
EssilorLuxottica, whose eyewear brands also include Oakley, has recently been looking to draw in younger customers, notably through its $1.5 billion purchase of “streetwear” label Supreme over the summer.
By Antonio Vanuzzo
Learn more:
EssilorLuxottica to Buy Supreme for $1.5 Billion
The French-Italian eyewear giant has agreed to buy the streetwear juggernaut from VF Corp. for $1.5 billion in cash, adding another lifestyle brand to a stable that already includes Ray-Ban and Oakley.
