Even LVMH isn’t immune to the headwinds facing the luxury industry. Bernard Arnault ’s conglomerate reported $45.2 billion in revenue in the first half of this year, down 1 percent year-over-year and less than estimates of $45.
9 billion, Forbes reported on Tuesday. In the second quarter alone, LVMH saw $22.7 billion in revenue, up 1 percent but less than early estimates of $23.
3 billion. The company’s latest financial results are of a piece with what’s been happening throughout the luxury world overall. After substantial growth in 2021 and 2022, thanks to consumers eager to spend their pandemic savings, the sector began to tumble in the second half of 2023, Forbes noted.
That dynamic has only continued this year, due to economic uncertainty around the globe and an increase in geopolitical conflicts. Notably, luxury shoppers in Asia have cut back on their spending. Back in 2021, consumers there made up a whopping 42 percent of the luxury market’s revenue by region, Forbes wrote.
But demand in Asia has lessened, with LVMH citing a slowdown in China as part of the reason for first-quarter declines in wines, spirits, watches, and jewelry. Other arms of Arnault’s business have seen some growth recently, however, giving the company something to be optimistic about. Core business groups—including fashion, leather goods, and beauty—saw a 2 percent increase in organic revenue growth in the first half of the year.
Fashion and leather goods jumped 1 percent in the second quarter, while cosmetics grew 4 percent, according to Forbes . In response to the latest news, Arnault’s personal fortune dropped $135 million, and he now ranks as the third-richest person in the world. (At some points last year and this year, he was the wealthiest person on the planet.
) Shares of LVMH, meanwhile, are down 7 percent year-to-date, and they’ve fallen 21 percent since March alone. The luxury sector’s slowdown has hit other companies as well, including Burberry and Richemont. Kering , meanwhile, saw an 11 percent drop in sales in the second quarter of this year, the LVMH competitor announced on Wednesday.
Later this week, Hermès and the Prada Group will also post their results. It’s safe to say that the pandemic shopping boom couldn’t feel further away for luxury brands. Tori Latham is a digital staff writer at Robb Report.
She was previously a copy editor at The Atlantic, and has written for publications including The Cut and The Hollywood Reporter. When not..
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