EssilorLuxottica's leadership has closed ranks around chief executive Francesco Milleri after a public rebuke from a member of the founding family. A memo signed by senior executives defended Milleri and attributed the eyewear giant's recent share price decline to broader macroeconomic and geopolitical pressures, rather than to any failure of management.
The memo comes after Leonardo Maria Del Vecchio, son of the late founder Leonardo Del Vecchio, voiced criticism of Milleri's leadership. The younger Del Vecchio's comments added to investor scrutiny of a company that has faced a volatile stretch in the stock market, even as its core business—designing and selling eyewear brands like Ray-Ban and Oakley—remains a global powerhouse.
What's behind the stock slide?
EssilorLuxottica's shares have come under pressure in recent months, and the memo points to external forces as the main culprit. Rising interest rates, persistent inflation, and geopolitical tensions have weighed on global equity markets, hitting consumer discretionary stocks particularly hard. When borrowing costs rise, investors tend to discount the future earnings of companies that rely on discretionary spending, and eyewear, while essential for many, is still a category where premium purchases can be postponed.
The company also faces currency headwinds, as a strong dollar and volatile emerging-market currencies can affect its international sales. These are challenges that affect many multinational consumer brands, not just EssilorLuxottica. For context, similar pressures have been cited by other European consumer giants in recent earnings calls.
The memo's language suggests that the board and senior management see the stock's decline as a market-wide phenomenon, not a company-specific problem. That is a common defense when a company's share price falls despite solid operational results, and it often resonates with investors who are watching the same macro indicators.
Who is Francesco Milleri?
Francesco Milleri took the helm of EssilorLuxottica in 2020, following the death of founder Leonardo Del Vecchio. He had been a close confidant of the founder and previously served as vice CEO. Under his leadership, the company has continued to integrate Essilor's lens-making business with Luxottica's retail and eyewear manufacturing operations, a merger that was completed in 2018.
Milleri has overseen a period of steady revenue growth, driven by strong demand for premium eyewear and the expansion of digital sales channels. However, he has also faced criticism from some investors and family members over governance issues and the pace of integration. The Del Vecchio family remains a significant shareholder, so the heir's public criticism carries weight.
The memo, signed by a group of senior executives, is a clear signal that Milleri retains the confidence of the company's leadership. It also serves as a message to the market that the executive team is united, even if the founding family is not entirely on the same page.
What it means for investors
For everyday investors, this episode is a reminder that leadership disputes and family dynamics can create volatility in a stock, even when the underlying business is sound. When a major shareholder publicly criticizes a CEO, it can raise questions about strategy, succession, and governance—issues that can affect a company's valuation.
However, the memo's defense of Milleri suggests that the board is not planning a change at the top. That stability may reassure investors who were worried about a leadership vacuum. The company's fundamentals—strong brands, global distribution, and a growing market for vision care—remain intact.
Investors should also keep an eye on the broader macro environment. If interest rates stay high and geopolitical tensions persist, consumer discretionary stocks like EssilorLuxottica could continue to face headwinds. Conversely, if inflation cools and central banks signal rate cuts, the stock could recover as part of a broader market rally.
For now, the message from the executive suite is clear: the company's problems are external, not internal. Whether that convinces the market remains to be seen, but the show of unity is a positive sign for those who believe in the long-term value of the world's largest eyewear company.
Related reading: board support for the CEO and how macro factors are moving markets.
