EssilorLuxottica snags Supreme

The Future. After less than four years, Supreme has a new home, with VF Corp selling the storied streetwear brand at a loss to Italian eyewear giant EssilorLuxottica. As EssilorLuxottica’s only apparel brand, expect it to make Supreme the flagship of a new push into fashion.

Streetwear State of the Union
EssilorLuxottica, which owns brands like Ray-Ban and Oakley, is acquiring Supreme in a deal worth $1.5 billion — that’s $600 million less than VF Corp bought it for.

• The Italian conglomerate said it would allow Supreme to operate independently — a move that makes sense considering its lack of experience in streetwear.
• But the likely first move is figuring out who will take over as creative director — a position that has been vacant for a year after the resignation of Tremaine Emory.

VF Corp, the owner of popular brands like Vans and The North Face, has been signaling that it would take almost any measure to cut costs in recent years as it planned to pay down its debt. Selling Supreme at a loss shows how serious VF is in accomplishing that fast.

But it also shows that Supreme, which reliably brings in half a billion in revenue each year, isn’t reaching the growth targets that many expected, especially as the brand has multiplied its number of stores and expanded internationally. It also doesn’t sell out of its drops as much as it used to.

So, either Supreme’s dominance as the top streetwear brand or streetwear itself has peaked. Only time will tell.