Luxury Briefing: How Canadian outerwear brands are navigating new tariffs

Canadian brands Moose Knuckles and Soia & Kyo are working to answer demand, with outerwear priced between $400-$1,100. But even as demand grows, the U.S. market — long a key revenue driver — has become increasingly difficult to serve. On August 1, the U.S. imposed a 35% tariff on Canadian products, adding cost pressures that threaten margins and force brands to rethink distribution strategies.

“Canada Goose is still a leader, but they’ve priced themselves out of reach for many,” said Ellen Kinney, who became CEO of Moose Knuckles in early 2025. “That opens up space for brands like ours that are built for performance but also understand the consumer’s demand for style and value.”

Kinney, previously of A.P.C., Derek Lam and Rebecca Taylor, stepped in as the brand looks to grow from cult streetwear label to global player with a refreshed campaign strategy and store redesign. Moose Knuckles, which took on private equity investment from Cathay Capital and NXMH in 2019, now generates an estimated $200 million annually, about 15% of Canada Goose’s revenue.

Moose Knuckles is sold through 1,000 wholesale doors in 30 countries, with standalone stores in New York, Toronto and Beijing and an outlet store in the UK, as well as luxury wholesale partners like Harrods and Nordstrom. It also operates a joint venture with outerwear brand Bosideng in China, a key growth region alongside the U.S., the U.K., and France. Its jackets typically sell for $800–$1,100, and its core demographic is urban 25–40-year-olds looking for high-performance gear with design credibility.

Currently, the brand is expanding into lighter jackets and layering pieces to meet demand in markets with milder climates. “We’ve dominated in that level four space,” said Kinney, referring to Arctic-level parkas. “But there’s a huge opportunity in levels one through three, and no one owns that space yet.”

But as Moose Knuckles rolls out a more globally flexible assortment, tariffs are affecting short-term priorities. “Tariffs like these force you to get even sharper on pricing, sourcing and market mix,” Kinney said, pointing to efforts like tightening margins on U.S. goods, optimizing supplier relationships across Asia and Europe, and rebalancing growth efforts toward less tariff-heavy regions like the U.K. and China. “The U.S. is still our biggest growth engine, but we’re absolutely focused on global expansion — not just as a growth play, but also as a buffer against volatility.”

Further down the price ladder is Soia & Kyo, founded in 2004. The company is also based in Montreal and is part of APP Group, which also owns Mackage. While Mackage plays in the high-fashion luxury space, Soia & Kyo delivers refined, minimalist outerwear with feminine utility, with pieces priced between $400-$800.

“The focus is on coats that move with you and work for every part of your day,” said Natalie Gilmore, the new vp of design and product development at the brand. Over the last 18 months, Gilmore has led a quiet brand reset, updating legacy styles in new materials and finishes. The line now includes stretch down, removable bibs and lightweight cotton-shell puffers to feel more like everyday layers than seasonal coats. Since joining APP Group in 2004, Soia & Kyo has consistently expanded, supported by a growing direct-to-consumer business, according to the brand. APP does not disclose revenue.

Soia & Kyo targets women aged 30–55, especially working professionals in urban areas. “We hear from people who’ve owned their Soia coats for 15 years,” Gilmore said. “That kind of emotional durability is a differentiator.”

The brand is sold through over 300 global retailers, including Nordstrom, Saks and Bloomingdale’s, and is pushing deeper into the U.K., France, and Germany to reduce its reliance on the U.S. While North America remains its strongest DTC region, Europe is now a central focus.

In their most recent earnings, both Moncler and Canada Goose confirmed further price increases to protect margins and reinforce positioning. Moncler, in its July 2025 earnings report, said it expects pricing growth due to inflation, after posting €3.1 billion, or about $3.35 billion, in H1 revenue. In May 2025, Canada Goose said it would apply “modest increases” to carryover styles and adopt “more strategic pricing” on new products. McKinsey’s 2024 State of Fashion report found that over one-third of global consumers had recently “traded down” in at least one category, suggesting a rising appetite for premium alternatives at more accessible price points.

HSBC upgrades LVMH and Kering, downgrades Hermès

Bank HSBC has revised its stance on the luxury sector, signaling renewed optimism for the second half of 2025. After four sluggish quarters, analysts now expect average sales across their covered companies to rise by 3% in H2, led by improving trends in soft luxury.

Notably, LVMH and Kering were both upgraded to Buy from Hold, while Hermès was downgraded to Hold. “We view Hermès as a much better business than the rest of our coverage, but we don’t see its sales accelerating much in H2,” analysts wrote in the note.

The upgrade for Kering is particularly striking, given its recent struggles and lack of consensus optimism. HSBC noted that, while there’s no major insight yet into incoming CEO Luca de Meo’s plans, “experience tells us that incoming external CEOs get a pass in the first three to four quarters,” allowing time for turnaround efforts to take hold.

The bank emphasized it is prioritizing sales momentum over valuation or margins. “Investors shouldn’t buy a stock because it looks cheap, … but rather because the second derivative of sales growth is accelerating.”

For LVMH, the bank highlighted Dior’s rebound, cost containment and long-term structural opportunities.

News to know

• Proenza Schouler’s appointment of Diotima founder Rachel Scott as creative director marks a generational and cultural shift for the American luxury brand — Scott is the first external and first female lead since the brand’s 2002 founding. Her first full collection will debut in February 2026. She will continue to helm Diotima while overseeing all Proenza Schouler’s ready-to-wear, White Label, handbags and footwear.
• The runway debut of Post Malone’s Austin Post fashion brand, held in Karl Lagerfeld’s former home in Paris, came complete with a live horse and Bud Light toasts. The looks featured U.S.-made denim, Lucchese cowboy boots and a sunglasses collab with Jacques-Marie Mage. Austin Post pieces start at $150, with most pieces priced under $600.
• Swarovski is marking its 130th anniversary with the launch of the swan-inspired Vienna Collection, a lineup of Creators Lab collaborations, a global “Masters of Light” exhibition stopping in Hollywood and immersive in-store activations. The company saw 5% organic growth in the first half of 2025 and a return to profitability in 2024.

Listen in

On this week’s Glossy Podcast, Danny Parisi and Zofia Zwieglinska break down Abercrombie’s ongoing earnings streak, boosted by Hollister and an NFL tie-up. Plus, American Eagle’s bounceback via a Travis Kelce collab, following a misstep with Sydney Sweeney, and Marks & Spencer’s entry into resale through a new eBay storefront. Plus, Zwieglinska sits down with After School founder Casey Lewis to decode Gen Z’s back-to-school shopping habits, based on thousands of TikTok hauls. Listen here.

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