LVMH reported quarterly sales that missed expectations as the luxury industry struggles to reinvigorate demand following last yearâs slump.
Sales fell 5 percent on an organic basis in the key fashion and leather goods division, whose biggest brands include Louis Vuitton, Dior, Fendi and Loewe. Analysts had forecast a 1 to 2 percent dip.
Group revenues fell 3 percent, with no divisions reporting growth. Wine & Spirits experienced the steepest decline, with sales down 9 percent, while watches and jewellery was the most resilient division, reporting flat sales. The perfume and cosmetics segment, which includes Parfums Christian Dior and the retailing division operating Sephora and DFS both fell by 1 percent.
Bernstein analyst Luca Solca called it a âdifficult startâ to the year.
The across-the-board sluggishness is a worrying sign for luxuryâs current trading, as macro-economic conditions have deteriorated amid mounting uncertainty since the end of the quarter. Hopes that US consumers would buoy luxury this year have evaporated as market volatility following US President Donald Trumpâs tariff announcements has dashed consumer confidence. Meanwhile, intensifying tensions between the US and China make it increasingly unlikely that the latter countryâs stimulus efforts will be enough to reinvigorate demand.
The group seems keen to strengthen their footprint in Asia, staging a Dior retrospective in South Korea, a Loro Piana exhibition in Shanghai and a Loewe exhibition in Tokyo.
Stay tuned to BoF for updates on this developing story.
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