Stefano Gabbana, co-founder of the iconic luxury fashion house Dolce & Gabbana, has stepped down as chairman of the company he launched with Domenico Dolce in 1985, as the brand faces mounting financial pressure and a broader slowdown in the global luxury market.
Company filings show that Gabbana, 63, informed the firm of his decision in December, with the leadership change taking effect on January 1. He has been replaced as chair by Alfonso Dolce, the company’s chief executive and brother of co-founder Domenico Dolce.
Despite stepping down from the chairman role, Gabbana will continue to play a central part in the company’s creative direction. He will remain a creative leader alongside Domenico Dolce, maintaining the decades-long design partnership that built the brand into one of the most recognizable names in fashion.
The leadership shift comes as Dolce & Gabbana grapples with roughly €450 million in debt and a broader slowdown in luxury retail spending, particularly in key markets such as China.
Industry analysts say the financial strain reflects broader challenges in the luxury sector, where slowing consumer demand and changing spending habits are affecting even well-established brands.
“It’s no secret that the brand is in significant debt,” fashion expert Priya Raj told the BBC. She noted that the company remains privately owned, with Stefano Gabbana and Domenico Dolce each holding a 40 percent stake in the business.
What the leadership change means for those ownership stakes remains unclear.
Reports earlier this year suggested the fashion house had hired a financial adviser and begun discussions with creditors regarding its debt obligations.
The company said in a statement Friday that it had no additional comment on the debt situation while negotiations with banks remain ongoing.
In recent years, Dolce & Gabbana has attempted to diversify its revenue streams beyond traditional fashion by expanding into lifestyle sectors including hospitality and furniture. Its latest home collection features luxury items such as a leopard-print porcelain vase priced at £1,084.
Despite financial headwinds and several public controversies, analysts say the brand’s distinctive design identity continues to resonate with consumers.
Dolce & Gabbana is widely recognized for its signature black lace designs and bold, sensual aesthetic inspired by Sicilian heritage.
According to Raj, the company has also managed to survive several cultural controversies that might have damaged other luxury brands.
“They’ve managed to outlast cancel culture,” she said, noting that the brand still maintains a strong and loyal following.
The most recent controversy occurred during the Fall/Winter men’s show at Milan Fashion Week earlier this year, where critics accused the brand of lacking ethnic diversity in its model casting. Model Bella Hadid publicly criticized the company on social media.
Still, Raj believes the core challenge facing Dolce & Gabbana is not its creative direction but its financial management.
“The problem isn’t with the designs at all,” she said. “It’s the financial running of the business. They clearly need some outside help.”
Industry observers say the company may eventually seek a minority investor or strategic partnership to stabilize its finances and support future growth.
Dolce & Gabbana rose to global prominence in the late 1980s and early 1990s, fueled in part by celebrity endorsements. One defining moment came when Madonna wore the brand and commissioned it to design costumes for her 1993 “The Girlie Show” tour supporting the release of her album “Erotica.”
The collaboration helped cement the label’s provocative and glamorous image while the company also expanded into more accessible luxury products such as sunglasses and perfumes.
In announcing the leadership transition, the company described Gabbana’s move as “part of a natural evolution of its organisational structure and governance.”
Champagne Says Boosting Financial Trade with China Key to Broader Diversification