Leather isn't recycled if it's the first use afaik, but it can be repurposed and recycled to extend its usefulness (yes there is still a big environmental cost to it).
I'm on the fence when it comes to it personally, pleather/vegan leather/whatever it's called these days is oil-based and thus far from perfect or cleaner. It's also ironic how much we look into whether leather or synthetics is a cleaer solution when talking about electronic devices - which are really not environment-friendly at all in any way, but we have little alternatives to that.
Recycled nylon/polyester fibers could be an interesting alternative if the production chain is cleaner (aka hopefully it's not just more greenwashing).
I should have said diverted rather than recycled. My mistake