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Italian fashion house Ermenegildo Zegna has warned that the ongoing conflict in the Middle East has added uncertainty to luxury demand forecasts, even as markets in China, the U.S., and Europe remain stable, according to Bloomberg.

“It’s difficult to predict exactly how the situation in the Middle East will develop,” said Executive Chairman Gildo Zegna as the company reported its full-year results.

The three-week-old war has heightened uncertainty for the global economy in 2026. Still, the company noted that direct-to-consumer sales in the first quarter are tracking above fourth-quarter 2025 levels.

While Zegna did not provide specific guidance for 2026, it remains focused on achieving its 2027 targets, which may be adjusted depending on the duration of the conflict.

“The situation is constantly evolving, and the potential impact on the group and the broader luxury sector remains uncertain,” the company said.

Founded in 1910 as a wool mill in Trivero, Italy, Zegna is one of the world’s leading makers of high-end menswear. About 6–7% of its sales come from the Middle East. After some temporary closures, all stores in the region have now reopened.

“In the Middle East, as a high-end brand, we are in a competitive advantage over others and feel more resilient,” Zegna added.

The company’s New York-listed shares have dropped 18% since the U.S. and Israel bombed Iran on February 28. Analysts at Morgan Stanley note that Zegna is among luxury brands with significant exposure to Middle Eastern sales.

Zegna plans to maintain its global capital spending and marketing budgets, but may adjust investments by region depending on where demand is strongest, the chairman said.

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