Miu Miu momentum lifts Prada, but Iran tensions cast shadow over luxury recovery
Robyn Duffy, Consumer Markets Senior Analyst at RSM UK, comments on today’s results from Prada: “Prada’s revenue growth slowed to its weakest rate since 2020, reflecting the tougher backdrop for global luxury demand in 2025. However, stronger fourth quarter sales suggest momentum improved for the group at the end of the year.
“Many expected Miu Miu’s performance to normalise this year but continued double-digit retail sales growth indicates the brand’s momentum remains strong. The strategy of building cultural relevance rather than pursuing rapid commercial expansion for Miu Miu appears to be paying off, sustaining desirability without triggering brand fatigue.
“Looking ahead, Prada’s €1.25bn acquisition of Versace adds another globally recognised brand to the group at a time when scale increasingly matters in luxury. The key question for investors will be how quickly Prada can restore momentum at Versace while maintaining the strong performance of its core brands.
“Geopolitical risk remains a headwind in the luxury market. Prada’s direct exposure to the Middle East is relatively limited, with around 24 out of 620 stores in the region. However, the Middle East has been one of the fastest-growing luxury markets, with early projections pointing to around 4–6% growth in 2026, ahead of the wider industry. Escalating tensions in Iran could therefore weigh on consumer confidence and discretionary spending in the region, potentially hindering the luxury sector’s recovery.”