What's going on at Dolce&Gabbana? Stefano Gabbana has stepped down as president of the brand, with Alfonso Dolce taking over

Stefano Gabbana, co-founder of the brand that bears his name, is no longer the chairman of the board of directors of Dolce & Gabbana since last December. The news was not initially made public and has only now emerged from a document filed with the Italian corporate authorities. Since January, the role of chairman has been held by Alfonso Dolce, brother of Domenico Dolce and current CEO of the company, while Gabbana remains co-creative director.

As reported by BoF, Gabbana is also reportedly considering changes to his shareholding in the brand, in which he holds 40% of the capital. This is happening ahead of upcoming negotiations that the brand is about to open with its lending banks for the restructuring of a significant debt, amounting to around €450 million. Domenico Dolce holds another 40% of the shares through a holding company, while the remainder of the capital is controlled by Domenico himself, along with his two siblings Alfonso and Dorotea. This family-owned structure underpins the independence of their empire.

What is happening?

The entire situation at Dolce & Gabbana was triggered by the luxury crisis that is causing so many problems for brands around the world. While the situation was already difficult in 2025, the outbreak of hostilities in the Middle East — which created uncertainty in the markets and closed a key regional commercial hub — has made things worse. Even the brand founded by the two designers has seen shrinking margins and, as Bloomberg explains, has encountered some difficulties in complying with certain covenants related to the management of its debts.

The brand has accumulated €450 million in bank debt, a figure that has grown further after the €150 million refinancing obtained last year. According to Bloomberg, the banks are requesting a fresh capital injection of up to €150 million to restructure this debt. The company is therefore considering the sale of some owned real estate assets as well as the renewal of various licenses, with the advisory support of Rothschild & Co.

The changes do not end here. While addressing the debt issue and the need for new capital, the company is also working on bringing in former Gucci CEO Stefano Cantino, who is expected to take on a very important role in the brand’s structure. Cantino will likely help the brand continue its ambitious expansion, for which it had already secured a debt extension until February 2030 from the banks last year.

The challenge of growing during a luxury famine

A similar problem, on a much larger scale, is what Kering is facing. In addition to sales issues across its brands, the group has become weighed down by debt due to costly real estate investments and expensive acquisitions. These moves, made during a period of luxury market weakness, have forced the group to bring in Luca De Meo as the new CEO. Something similar appears to have happened with Dolce & Gabbana, which has invested heavily in expanding its beauty business, real estate, and hospitality to diversify its revenue streams.

But we are not living in favorable times. Fashion and luxury are in crisis, also due to rising costs and prices and a shrinking customer base, to the point that Valentino needed a €100 million cash injection from its shareholders Kering and Mayhoola. Even Giorgio Armani has stipulated in his will that his heirs sell at least 15% of the company to external investors within 18 months to preserve its stability. For some time there has also been discussion (though perhaps unlikely) of LVMH’s potential plan to separate its fashion division from its spirits business, which has not been performing well for some time.