The situation: The Trump administration’s tariff-driven policies are starting to weigh on US consumer demand, but it’s still too early to gauge the full impact on Hugo Boss’ US business, which accounts for about 15% of its revenues, CEO Daniel Grieder told analysts on the company’s earnings call.

• Sales in the US had a “moderate” decline, while revenues across the broader Americas region slipped 1% YoY.
• Total revenues fell 2% YoY on a currency-adjusted basis to €999 million ($1.14 billion), slightly above the €979 million ($1.11 billion) forecast in an LSEG poll.
• The company reaffirmed its full-year guidance, forecasting 2025 revenues between €4.2 billion ($4.77 billion) and €4.4 billion ($5 billion)—roughly flat against last year.

The strategy: Hugo Boss is taking a nimble, multipronged approach to mitigate tariff-related pressures and broader macroeconomic volatility.

• To reduce exposure, the company is rerouting China-made goods away from the US and toward other global regions. It’s also leveraging its flexible supply chain and short lead times to quickly adjust sourcing decisions if trade conditions shift.
• The brand’s long-term diversification efforts are also paying off. Hugo Boss has gradually reduced its global sourcing share from China—from about 20% to the mid-single digits in recent years. Around 20% of sourcing is now handled in-house, primarily in Turkey, while no single external country outside Turkey accounts for a major share.
• The company is also weighing potential price increases to offset rising costs.

Our take: In an uncertain trade environment, agility is critical. Hugo Boss’s diversified sourcing and supply chain flexibility give it an edge over less-prepared luxury peers—and a more stable footing in an increasingly volatile market.